• Motley Fool, Monday, January 22, 2007 11:15 AM

No coincidence that print media has fallen on hard times, while Internet ad revenues continue to climb. Now the rest of the traditional media sector is seeing audience erosion and revenue declines. But new media isn't a safer bet at the moment either. The only way to invest smartly in the media space is through Web access providers (cable and telecom companies). Investors should stay away from any company whose fate relies solely on advertising.

Jim Cramer of TheStreet.com agrees. He says seasonality dictates that the first quarter is often a tough time in general for the media and technology sector. He liked Web infrastructure companies like Comcast and Level 3, but aside from Apple, Inc., media's a risky bet at the moment.

Which leaves the burgeoning Web ad industry asking why? Perhaps analysts are getting fed up with media companies' inability to monetize user-generated content. Then there's the copyright issue with Google's YouTube and several others. But that ignores (or rather highlights) the growth of online advertising; Web ad networks and interactive marketing shops, which are showing incredibly strong growth. Demand for ads is high; inventor is in a rut.

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