ChasNote

From an interview at Silicon Alley Insider:

“SAI: Haven’t ad networks played a role in holding down online CPMs?”

“Moore: I dont think its the networks that are doing it. I haven’t spoken to anybody who thinks media fragmentation is going to stop. I think we are dramatically underpriced compared to offline. The amount of money newpapers and magazines have been getting per thousand is outrageous. Newpapers and magazines are still getting roughly 30% of all advertising expenditures–yet if you look at their share of media usage, they’ve got between 7% and 9%. Thats why they’re having so much trouble.”

Oh, come on. Google and the ad networks are selling clicks, even when the advertiser signs an IO with the acronym “CPM” after the $0.70 price tag. They are giving away for free the vast majority of impressions, those that don’t generate a click. They are telling advertisers that those impressions have no value. Charging nothing for impressions that make a positive impact on creating demand and spurring consideration is, in fact, charging too little for the service rendered. Google and the ad networks are most certainly deflating CPMs across the media landscape.