• JackMyers.com, Tuesday, June 10, 2008 9:15 AM

Media executives planning for a digital future are embracing mass media "network" advertising models that may appear viable in the short term, but will ultimately fail to deliver.

Ask venture capitalists who have made bets on content-based and ad-dependent companies how their investments are performing. "You'll hear that two to four years in, most are generating returns for investors far below the minimum ten-time multiples they expect."

The problem is that the pool of ad dollars is stagnant, while new media alternatives are popping up virtually every day and ad budgets are splintering into micro-fragments. Advertisers will continue to be pulled in multiple directions. The media industry has to face that "advertising is simply not a sufficient revenue model to sustain content companies into the long-term future."

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