Maybe you’re thinking that online advertising ISN’T QUITE KAPUT, given recent figures that show a steady increase in online ad revenues this year. According to the Internet Advertising Bureau, Net ad revenues added up to nearly a billion dollars in the second quarter of this year; annual ad revenues will hit $3-3.5 billion this year, depending on who you ask. (And if you’re even more optimistic, check out Advertising Age’s recent study, which predicts $7.4 billion in online ad spending over the coming year.)

I’m not quite ready to admit I’m wrong, though. There’s more to the online advertising story than mere revenue growth, because the way people are using online ads continues to change — banner ads are more interactive, alternatives to banners continue to gain ground, and advertisers are increasingly interested in *sponsoring* whole sites or sections of sites, a form of advertising that gives them greater visibility, flexibility, and control.

Oh yeah, and venture capital investments in Net startups continues to grow. Is anyone surprised?

Net Firms Rake in Billions More
(The Industry Standard, Nov. 04)

Dot-coms to spend $7.4 billion in the next year–unless the market goes bust.
(Ad Age, Nov. 1)