Is The Free Ride Over For Web Startups?

My sites have done OK w/ advertising since Fall 2008, but I'm more weighted towards PPC and CPA.

Web advertising has it's challenges, but it's clear that advertisers are wildly overspending on offline advertising, and that much of that spending is going to disappear.

I used to work for the largest web consulting shop in a small town. My accountant and other small business people would ask how much a site from us would cost: I'd say that a site with custom design and CMS would start around $2k.

Often they'd be shocked... They'd expect to pay more like $80.

The same businesses have been spending $100 a day for tiny display ads in the local newspaper... Add that up for 365 days, and you could afford rent for a modest storefront or an extra employee. You could spend less than half of that (once) and have the beginnings of an e-commerce site that would bring in recurring and measurable income.

Businesses are wising up and pulling their ads out of the local daily: some of that money is going to get funneled into advertising models that work for advertisers, such as PPC and CPA.