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Online, Mobile Ad Spending Explodes, Threatens Traditional Media?

online ads spending

Some thinking about online advertising spend in 2010 suggests that this year it's going to see serious growth, which is fabulous news for new media. But it's potentially bad news for traditional publishing.

The analysis is coming from ZenithOptimedia, which has been revising its estimates for online advertising spend in 2010 upwards for several months now. Its latest piece of thinking has attracted some attention in the online media itself because it predicts that the spend in 2010 will rise some 13.1% throughout this year, and even zoom upwards another 16.1% in 2011. That figure is an amazing indicator that the economic downturn really is over, as ad spend was one of the big indicators that the recession was biting deep.

Particular emphasis is placed on the mobile ad market (as smartphones and tablet PCs revolutionize how people access the Internet) with Zenith predicting it will grow 43.2% on average, year on year, between 2009 and 2012. That's a huge growth, and it even outstrips the predicted increase in social media ad spends—30.2% for the same period. Of course, increased smart device use is also strongly linked with increased use of social media systems (particularly with the new vogue for location-based social gaming).

Is this data also a very negative sign for the traditional publishing game? Though TV advertising spending is still the biggest thing around, the battle for ads in printed media and online is becoming more important—and though the economy may indeed be growing, it's not doing so at the rates predicted. In other words, the extra money going to online ads has to come from somewhere. With falling readership figures for printed matter of all types, versus the rise of the Net, of blogs, and of digital-content-accessing devices (such as the iPad) you've got to go where the audience is.

Is this also another sign that the traditional newspaper's website paywalls are a bad idea? Because if online ad spends rise, then so will the quality (or at least, if you're cynical, the quantity) of online content sources. And since these tend to be free, the paid-access paywalls around traditional news sites will seem even more ridiculous. As people like Gawker's Nick Denton are fond of noting, in an online world you're only as good as the next mouse-click of your readers.

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