• by Brian Silver , May 12, 2008

It has taken me a while, but I could no longer sit on the sidelines and watch another "Networks are dead" article go by. In response to Jim Spanfeller's statements in Friday's Online Media Daily I ask: Can't we all just get along?

Just when I was beginning to think that Network was no longer a dirty word, I read that Networks have now peaked and that the only reason they are around is to help fill social network and emerging platform inventory. I would have to respectfully disagree.

The aggregation of inventory to help publishers monetize their content is not only on the rise, but today networks are doing this better than ever. Whether you are a vertical or horizontal network, we are still just beginning to understand their true power. To claim that all networks are only a remnant play whose only value is to drive down CPMs and cause people to click away from the publisher's content is not in any way accurate.

Last year could definitely be called the year of the horizontal network. This year, vertical networks are often in the headlines. Everyone, including Forbes.com, is announcing the creation of their own vertical network. Why would this be if their purpose was to "unload low cost remnant inventory"? Something bigger and better must be happening.

Vertical networks like Jumpstart Automotive Media have been aggregating the car buying audience for years. We aggregate one of the largest travel planning audiences anywhere online. NetShelter's technology audience is second only to CNET. We have all done this well enough to be very valuable assets to advertisers who want to get in front of these specific spending audiences. Glam, Travel Ad Network, and many other leading vertical ad networks have figured out how to aggregate and then segment their audiences deeper than any one publisher or networks in the past.

In travel alone, there are over 10,000 websites. Maybe the site ranked 2000th would not be worth a lot to the advertiser community as a stand-alone buy, but as part of a larger aggregated audience, their inventory is worth many multiples higher than as a stand-alone. And if they to have some of the top niche travel destination content, their CPMs could go from $5 as a small site, to well over $40 as part of a vertical network. Seems like a win.

I have been in the online advertising space for quite some time and have worked at a network for most of that time. Seems like someone is always saying that publishers are about to wake up and realize that they could make more money if they sold their own inventory.

Perhaps Jim is correct to say that ESPN could be better off selling it all themselves. After all, they are a well established on and offline brand with lots of traffic. But thanks to search driving traffic to very specific nice content, there is real value in sites ranked somewhere between 2 and 10,000. A vertical network can unlock that value by making their traffic part of a much larger, highly desirable audience.

Frankly, I think that networks are far from peaking.