Australian video ad spend just hit a record, and it is pooling in a narrower place than you would think.

The Australian internet advertising market took $4.9 billion in the March quarter of 2026, up 15.3 per cent on the same quarter a year earlier. That comes from the IAB Australia Internet Advertising Revenue Report, prepared by PwC Australia and released on 26 May. Video was the fastest-growing major segment, up 20.4 per cent year on year to $1.4 billion, and video now accounts for 73.2 per cent of all display expenditure, up from 71.4 per cent a year ago.

The March quarter is normally the soft one. This year it landed within one per cent of the record December quarter, which the report reads as the seasonal pullback having effectively disappeared.

What the numbers say underneath the headline

Every video category grew by double digits, but the growth is not evenly spread. Social video was the fastest-growing sub-segment in the whole report at 29.4 per cent year on year. Broadcaster video on demand grew 10.1 per cent. Search and directories remain the biggest single segment at $2.16 billion and roughly 44 per cent of the market, growing at the fastest rate since the 2022 recovery.

Two industry categories moved their share of general display more than any others. Automotive was up 1.7 percentage points, the largest increase of any category, driven by broadcaster video on demand and automotive platforms, with new Chinese car brands now a visible presence in Australian digital spending. Retail was up 1.4 points. Health and beauty, entertainment and media, and fast-moving consumer goods all lost share, consistent with households pulling back on discretionary spending.

Why a record quarter is not automatically good news for the people spending it

Read those two facts next to each other. Spending on video is at a record, and most of the new money went into social video, which has the shortest useful life of any video format and the least control over where it ends up.

Anyone who has run a business through a good quarter knows the feeling of a number going up while the underlying thing gets harder. That is what this looks like. Advertisers are buying more video than ever and buying it in the places where a video is worth the least the day after it runs.

The automotive result is the one worth sitting with, because it moved more than any other category and because the money there is going into broadcaster video on demand rather than only into feeds. New entrants building a brand in a market that does not know them are buying long-form, full-screen environments. Established players defending share are the ones under pressure to keep the feed fed.

What we think this means

The market is telling on itself. Australian businesses are spending a record amount on video, and a growing share of it is going into environments designed to be consumed and forgotten.

We build for the other side of that trade. A brand film, or a properly structured YouTube channel with the metadata under it, keeps returning traffic and enquiries long after the invoice is paid. A social video is a rental. Both have a job. The problem is a market where the rental line grows 29 per cent and the ownership line grows more slowly, because the second one is what a business still has when the platform changes its algorithm or its terms. The Track Trailer T-Van film is the version of that we can point at.

There is a second reading, and we hold it honestly. Some of that social video growth is small and medium businesses entering digital advertising for the first time, which the report itself notes as a broadening of the advertiser base. For a business that has never advertised, a feed is a reasonable place to begin. The question is whether anyone tells them what the next step is, or whether they spend three years renting attention and never build anything they own.

Le Roy's line about a narrow set of environments is the professional judgement of the peak body for the industry taking the money. It is worth more than any agency's opinion on the same point, including ours. If you are planning next year's video budget, the split towards video is more or less settled already. What is still open is how much of what you make will still be working in three years. For the other side of the same market, the two Australian counts of AI users published on the same day disagree by four million people on a single platform, which is worth knowing before anyone quotes one at you.