Online ad slowdown in the making?

Michael Learmonth:

So much for the theory that online ad networks are immune to an economic slowdown: PubMatic, a company that helps online publishers sift through ad network offerings to find the highest-priced ad, said average ad network prices were down 23% from March to April…

Big sites fared worse than small ones. Ad rates for big sites (more than 100 million page views a month) dropped 52% to $0.18 in April from $0.38 in March (do I hear free?). Medium sites (1 million to 100 million page views a month) were nearly flat with rates dropping a cent to $0.33 from $0.34, while small sites actually improved to $1.29 in April from $1.18 in March.

Is this a wholesale slowdown in the making, or long-tail economics coming into play? Maybe “free” does make sense in some circumstances – and maybe larger sites (or those wanting to move into the “large” category) should start thinking about new business models.

Disclosure: This weblog participates in the Forbes program, a network of small sites, and I do it just for fun.

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