Online Ad Revenues

Read recently about growth in online Ad Revenues here. However, the following conclusion from the post about decline in older media budgets doesn't make sense to me.

Some of the growth is a reallocation of increased spending, but some of it is pure decline in older media, with broadcast, television, radio, and newspaper struggling in recent years. That is a trend that looks set to accelerate over the next twelve months, which will be financially painful indeed for such industries.

It is pretty clear that online Ad revenues are growing. But are they really making any dent in the traditional ads? I don't think so. From the graphs below, I do not see any decline in Traditional ad revenues. I sure see an increase in overall Ad spending. Online Ads are still about 2% of total Ad Revenues. And while it may continue to grow, what we might see is an overall increase in ad spending rather than a decline in traditional media revenues. Because, the sales gained per each $ spent on online ads is substantially lower than the traditional media.

[ Source  ]

Traditional media like TV and News papers have also started leveraging internet for improving their share of penetration and viewing stats. That would directly mean, more ad revenue for traditional media than online ads.

Lost Remote has a press release from CBS reporting favorably on their YouTube experiment. CBS uploaded 300 clips that were seen by almost 30 million viewers (mostly clips from Letterman), but they also saw a spike in TV viewership, especially on Letterman.


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