Ads find strength in numbers

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Technology costs play a role too in the increasing demand for ad networks. Sophisticated software to serve up ad banners, report ad views, and bill advertisers is just the beginning. As Web advertisers move toward tailoring ad banners to individual Web surfers based on their interests or demographic traits, the investment in technology leaps higher. Ad networks can leverage investments in that kind of technology across multiple sites, Mohdal said, while single sites cannot.

For example, DoubleClick manages information about visitors across its 60-plus sites using "cookies" that identify an individual Web browser. So when one browser hits iGolf, Total Baseball, and Travelocity, the DoubleClick server infers that an ad for a golfing vacation or fantasy baseball camp is a good bet.

Vendors of user tracking software are also starting to cater to the new ad networks. NetGravity, which has software to let individual Web sites manage their ad inventory, is reportedly testing software to do the same for ad networks. The company declined to confirm this report.

But advertising networks by themselves won't answer still outstanding questions about the effectiveness of Net advertising. John Nardone, chief advertising buyer for interactive ad agency Modem Media and the person who controls more Net advertising dollars than any other single individual, says that ad networks are useful but not a panacea.

"Ultimately, the quality of sites and the quality of ad placement within sites are more important than anything," he said, noting that leading-brand advertisers want to be associated only with quality content.

Networks also don't help advertisers who want to move beyond ad banners to sponsor a particular section of a Web site because these deals are done directly with Web site publishers.

Still, ad networks offer lots of advantages on both sides of the transaction and seem to be the next important tool to make the Net profitable for content-driven sites.

"We as ad sales reps want to be the one phone call a media buyer makes so that we can allow them to spread their money over a number of sites," says Andy Batkin, CEO and president of Softbank Interactive. "The network is just the extension of that. We want to make it easier for people to buy."

Networks: New Ways To Sell Web Ads
Companies	Description	Potential size	Rates
Ad Reach: DoubleClick, Commonwealth, WebConnect	Reaches mass audience with ability to target individuals	Hundreds or thousands of content sites	CPM* or per response
Local: AOL's Digital City, Microsoft's CityScape	National ads run with local ads	50 to 200 city sites	Per response or percent of sales from ad
Personal Broadcast: PointCast, Freeloader	Deliver ads to desktop	15 to 20 channels	CPM*
In-House Content: Starwave, Pathfinder, AOL Greenhouse, CNET, ZDNet, iVillage, CMP TechWeb	Ads related to content	10 to 15 sites per network	Higher CPM* based on audience; percent of sales from ad
Navigation: Yahoo, Excite, Netscape, AltaVista	Mass traffic, short visits, keyword searches	2 to 3 hubs	CPM*
*CPM: Cost per thousand ad views Source: Forrester Research