Wednesday, August 30, 2006
Online Advertising Ready to Bubble
The USA Today (yes, McPaper) has something to say about the Web 2.0 rush that has VCs spending like its 1999. Writer Maney wisely points out that the cost of building websites is a fraction of what it was back in the bubble days, and companies shouldn't require $15 million to turn an idea into a web biz. He sounds like he's quoting straight from the Labitat manifesto build small and grow bigger as demand and resources require.I wasn't expecting this little diddy:
David Court of consulting firm McKinsey says, "In the next 24 months, we will see demand for online advertising actually outstrip the supply." That's why we're getting so many consumer websites: They're easy to build and a booming market for ads.
Most of the projections for web advertising are rosy, but demand outstripping supply? As fast as blogs and commerce sites are popping up, it seams odd to project that there won't always be someone with qualified traffic for sale.
IF companies and investors aren't overzealous in their expenditures and expectations, we won't have another bubble-crash scenario (note to self, sell all Web 2.0 stocks in 2009), but I'm not so sure that is going to happen.
Posted By Jason Dowdell at 01:15 PM
Permanent Link: Online Advertising Ready to Bubble
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