• The Hollywood Reporter, Wednesday, May 17, 2006 11 AM

It's no secret TV dollars are moving online: last year's television upfront garnered participating networks $9 billion in advertising commitments; this year, as marketers clip their TV budgets, the nascent broadband video market is expected do as much as $1 billion. The Hollywood Reporter's Diane Mermigas notes that TV executives would be "tickled" if the networks could come close to matching last year's numbers. Few will expect them to, especially as major marketers like Johnson & Johnson, with its estimated $500 million in network TV dollars, have pulled out of the upfront process. New media options abound; they're more measurable and command lower rates for more eyeballs. Witness MySpace doubling its ad sales every three to four months, or Yahoo commanding $1 million CPMs for its home page. In fact, the digital shift is happening so fast that new media giants like Google, Yahoo and Microsoft are struggling to keep up; Google, for one, can't even finish its products. Even so, Merrill Lynch's Jessica Reif Cohen estimates that by 2010 digital businesses will account for as much as 9 percent of earnings and 20 percent of cash flow at media giants like Disney, Time Warner, News Corp. and Viacom. However, until media content, time, space, and economics become interconnected, Merimigas says the media environment will remain "uncomfortable and uncertain."

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