The New York Times takes an interesting look at how newspapers like The Houston Chronicle and Yellow Pages publishers like Bellsouth and SBC Communications have recently become Google and Yahoo adword resellers, leveraging their existing sales relationships with small & medium business owners.

You can see why the search engines would be happy with such a partnership given how expensive and time consuming account managing millions of low value business advertisers would be. But from the newspaper perspective, you have to wonder whether they will learn the game fast enough before their portal partners begin stealing the food from their plates.   

You are no doubt somewhat bemused by the hype over video search, the latest craze animating the titans of the new economy. Yahoo and Google’s offer to host your home videos seems both considerate and vaguely sinister. We all know, after all, the kinds of video most people are looking for when they jump on a search engine. But rest assured, home movies are a red herring. As more and more people illegally digitise and download broadcast television and movie content, the real issue for media companies will be finding an effective means to simultaneously secure and open up their material for public access.

OK, you know video games are big business. And you have probably heard they can not only make as much money as a blockbuster movie, but if they are released in tandem with one, can do ever better. That’s about half true – most comparisons don’t factor in Hollywood’s downstream revenue from DVD retail and rental, and overstate video game numbers by leaving in hardware sales. But even still – it’s a hefty dollar sign, and if you happen to be a media company without a shiny new games development division, the big question on your mind has got to be – what now?

One of the wierdest creative tensions in Hollywood is between finding new distribution channels for old content, whilst rigorously defending existing channels from new challenges. Back when the box office was king, getting the DVD format greenlight was an uphill battle. Now that DVD is a $17.5 billion dollar industry, you can just imagine the reception to proposals for digital downloading replacements. Still, potential lost billions or not, it seems this time round Sony is determined to avoid being iPodded again.

When it comes to advertising space, you can really have too much of a good thing. However traditional ways of dealing with remnant inventory - discounting and supply restriction - have caused chronic problems for online publishers. So, just how do you give advertisers more of what they want, and less of what they don't?

Both broadcast and publishing industries have developed their own ways of managing advertising supply and demand. Magazine publishers generally plan their book sizes, not on editorial but on the number of pages they expect to sell. TV broadcasters similarly, have a ratio of ad avails per timeslot which is fixed by format and occaisonally by legislation. Not only is scarcity a good way to control pricing, but it is also a means of protecting the value of sold spots to existing advertisers. The Clear Channel radio network, for example, last year took active steps to reduce clutter by imposing on a company wide ceiling on the number of advertising minutes per hour.

Unfortunately not all companies have the same view when it came to the web. Like Central American dictators who routinely fired up the Treasury printers whenever they needed more cash, greedy websites have also flooded the market with bottom of the page banners, excessive text links, ad boxes of every size and dimension, rotating logos and god knows what else. For a while, the resulting glut led to bottom of the pond CPM rates, and the unpleasant necessity of cutting backroom pure acquisition deals with media chop shop operators. And yet paradoxically, a small percentage of those ads - known as premium inventory and typically in key content areas such as technology or finance - would sell out completely, leaving publishers in a dilemma.

Smart web publishers are now being far more careful about the way they deal with remnant inventory. Running house ads is fine for a limited amount of impressions, but too much and you risk the effectiveness of other commercial campaigns. Many operators now use Google or Overture to resell space on their behalf, with keyword campaigns linked to relevant content on the page. Yields are not amazing, but they are a hell of a lot better than the kinds of deals that were taking place before search targeted marketing took off.

The real solution to the inventory paradox may come not through limiting supply, but rather through gaining greater insights into audience behaviour. Web analytics software increasingly allows publishers to track the behaviour of site visitors and tag advertising accordingly. So even all the finance related inventory of a site sells out, finance related ads can still be served to a viewer as they progress to other parts of the network. What is not yet clear, however, is whether advertising is significantly less effective when it is directly related to the content on page or just tagged to a reader's generic interests.

There is no doubt that web publishers have a bit to learn from the inventory management strategies of traditional media companies. However, the fluidity of web advertising can become a strength if publishers can find ways to focus their advertising efforts without resorting to the commercial cacophony that is a feature of so many sites.