Nothing but net?

Joe Mandese

The big media story in 2008 will be the same one as the past several years: the internet. No surprise there. What I do find surprising is that, for all its growth – and online is growing far faster than any other major medium – the value of online advertising inventory is not rising. It has actually been getting cheaper. Even worse, it has been putting increasing price pressures on the rest of the media economy, forcing marketers to assess the underlying value of most traditional media. While that might seem like a good thing from an advertiser's point of view – i.e. lower advertising costs – it's also alarming, because without their ability to increase revenues or maintain revenues, the major media are likely to shrink, or even go away.

In the long term, that might drive more content, users and advertisers online, and the ultimate effect may simply be a transfer of economics from old-line media to the newer ones. But there are several reasons to wonder whether the internet isn't simply lowering the value of media for all concerned – the internet included.