Internet still learning how to deal with money

Published 9:00 pm Wednesday, July 25, 2001

Someone smarter than me once said that things are never quite as good, nor as bad, as we believe them to be. This describes the Internet perfectly.

Two years ago, the Internet could do no wrong, there was no limit to how it would change the economy and our lives. Today, it can do nothing right, with massive layoffs, diving stock prices, and plummeting earnings reports the basis for most Internet news articles.

But one aspect of the Internet continues to be overlooked during this dot-bomb era – it’s more popular than ever.

A pair of recently released reports paints an intriguing picture of the gradually maturing Internet. Usage of the Internet continues to rise, just as the fortunes of companies trying to turn clicks into cash comes crashing back to Earth. A significant force driving the Internet’s rising popularity is access at work, changing the mass media landscape significantly in the U.S., though not in any profitable way yet.

The first report from the Pew Internet and American Life Project found that more than half of those surveyed used the Internet the same amount as they did six months ago. Twenty-nine percent, meanwhile, used it more while 17 percent used it less.

The second report from Nielsen/NetRatings found that 42 million Americans accessed the Internet from the workplace last year, a 10 percent increase over the year before.

So in this new-age paradox, a rapidly maturing technology continues to increase in popularity while the fight to build a business around this technology grows equally more intense.

Content-based Web sites, including some newspapers, are about to begin charging users, following a business model that has only worked at two distinctly unique Web sites so far (The Wall Street Journal and Consumer Reports). But sites such as Salon.com are desperate for cash and not convinced that an advertising model will work on the Web.

I’m pitching my tent in the other camp.

Advertising has become so ubiquitous in our society, it’s only a matter of time until advertisers figure out how to make it work on the Web. Venture to Safeco Field and you will be bombarded by corporate logos – there’s even a sponsor’s logo on the turnstiles for crying out loud.

Advertising supports newspapers, magazines, radio and network television. These make up the overall media category that major advertisers look at when formulating an advertising campaign. Other parts of the campaign can include outdoor billboards, transit, and direct mail. The media category has now changed, however, and advertisers have yet to take full advantage of this change.

One-fifth of Americans’ time spent with media (including books, movies and video games in addition to the advertising supported categories mentioned above) is spent on the Internet. One reason people have less time today is there’s so much more media. And that dilutes any given message an advertiser is attempting to deliver.

One-fifth of media advertising, however, is not spent on the Internet. In the next couple of years, advertisers are going to realize this and correct the situation.

Furthermore, advertisers are going to realize that workplace Internet users – those 42 million Americans – can now be reached by an advertising message, in a place and at a time, that they never could before.

You may have read reports that suggest Internet advertising doesn’t work. Well, maybe not the type of advertising that has been tried to this point, but as the Internet continues to mature, so will the advertising. The audience here is too big to be ignored.