Excluding direct mail, Fine says U.S. ad spending will only grow 2.7% this year, and will trail the U.S. economy's projected 4.5% rate of growth. That is far more pessimistic than the outlooks issued by leading ad industry forecasters during their annual updates last month in New York, and comes as U.S. ad tracker TNS Media Intelligence is poised to release is own revised outlook early next week.

While it is unclear where TNS is leaning, the firm's data through the first eight months of 2006 shows major traditional media like newspapers and radio are waning, while emerging media like the Internet and Hispanic media outlets are continuing to surge.

SOURCE: TNS Media Intelligence. Newspaper figures include local and national newspapers. Network TV figures include the CW, MyTV, UPN, and WB Networks. Radio figures include local radio, national spot radio, and network radio. Internet figures are based on display advertising only. Hispanic includes Spanish network TV, Spanish spot TV, Spanish cable, Spanish magazines and Spanish newspapers. Other media includes B2B magazines, Sunday magazines, and mocal Magazines.

A new scattergraph TNS MI plans to distribute monthly beginning with the new year plots the precise monthly momentum of each medium and reveals a graphic picture of both the momentum and impact on the overall marketplace,

In fact, the Merrill Lynch team notes that the outlook for the Internet, not surprisingly, "remains bullish" for both search and display advertising. The TNS MI data only includes online display advertising.

Broadcast and cable TV, however, continue to show positive signs, according to Merrill Lynch, which notes that despite their challenges, traditional media remain an effective option for most marketers.