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1/06/2006
  Cringely sees the future of advertising

According to Cringely, traditional printed publications are doomed because online ads are stealing their main source of revenue. What's unique about his analysis is how he compares the ad real-estate differences between print and online:

Here's a part of the problem that has been for the most part missed by media and business analysts: A website is not really an electronic magazine. It can contain all the stories of its print equivalent, but IT CAN'T CARRY AS MANY ADS.

For magazines to qualify in the U.S. for shipping by Second Class Mail, they must have a measured advertising-to-editorial space ratio of no greater than 75 percent. Second Class Mail is the difference between life and death for a print magazine, and to qualify for it, they carefully manage that ad-to-edit ratio so that just slightly less than three times as much space is taken for ads as for stories.

Now compare this to the edit-to-ad ratio for most web pages. The densest web page will have one banner ad at the top, eight to 10 Google ads down the right side, and maybe another Google ad or two at the bottom. That sounds like a lot, but on a strict real estate basis, it is very hard to exceed an ad-to-edit ratio of 50 percent, and most web pages have three times as much editorial content as ad space -- the exact reciprocal of the experience with paper publications.

Good stuff. And Cringely gets even wiggier with it in this week's article - predicting Google building a targeted TV advertising system on top of their search data. Basically, Google will build the ad system from the Tom Cruise future-movie Minority Report (on top of the "Skynet" datacenter infrastructure from Terminator.)

Say what you will about these rantings, but I think Cringely understands Google's mindset better than Battelle.

 


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