IPC and Microsoft express insecurity in online ad arena.(Brief Article)

Two events caught my eye this week, which are closely linked and point to an apparent malaise in online advertising. IPC Media, which has long struggled to make its women's lifestyle portal BeMe.com a success, has announced that it's cutting back the website to reduce Anna Griffiths costs. At the same time, Neil Holloway, Microsoft's UK managing director, is looking at charging MSN users, which up until now has been a free internet portal. There is speculation that this could prompt the demise of free internet portals.

The story behind these two moves is the softening of the online advertising market. But the big question is, are advertisers running out of steam because they are less than impressed with a lot of the online offerings out there in terms of content? Or is it merely down to the exit of dotcom advertisers last year, whose reversed fortunes led to a gaping hole in online advertising revenues?

I would argue that it is a bit of both with a more serious creative issue thrown in too. Let's take the case of BeMe.com which bravely launched on to the market after the likes of Charlotte Street and Handbag.com and didn't baulk at addressing such a hard-to-please, broad market (ie. "wimmin") when companies such as the National Magazine Company ditched plans to launch its own UK portal because the market was seen as too difficult to crack.

BeMe's site had masses of layers to it, lots of pretty pastel colours and dollops of ...