Advertising in the U.S. will be about $294.4 billion in 2008, according to experts at Universal McCann, an Interpublic company (www.universalmccann.com). Worldwide advertising revenues will be about $653.9 billion. These estimates may require downward revision as the year unfolds, depending on the outcome of the economic slowdown occurring in much of the developed world.

Advertising is irrevocably linked to media, whether traditional media like the 14,068 radio stations in America (about $19 billion in annual revenues), the 2,750 broadcast TV stations plus myriad cable and satellite TV outlets (totaling about $67 billion in advertising revenues), the 2,344 daily and Sunday newspapers (about $42 billion in annual advertising revenues) or new media like the tens of thousands of Internet sites that now accept advertising. The advertising sector also includes direct mail, at about $64 billion yearly in the U.S.; magazines, at about $25 billion in advertising revenues; and outdoor advertising, at about $6.8 billion. In addition, there is significant activity in specialty and alternative advertising, everything from ball point pens printed with a message to t-shirts to small airplanes towing advertising banners. Branding, marketing and public relations activities and services generate billions more in revenues.

Advertisers are faced with daunting new realities when considering the various media they might use to get their messages across. Traditional media are losing control over their audiences. That means that advertisers can no longer feel secure that their ads on TV, on the radio or in print are going to receive mindshare. Gone are the days when television and radio programmers enjoyed captive audiences who happily sat through ad after ad, or planned their schedules around favorite shows. Consumers, especially consumers in younger demographics, now demand more and more control over what they watch, read and listen to, and thus more control over the advertising they might be exposed to.

Nonetheless, for advertisers willing to adapt to today's rapidly evolving environment, there is good news. Effective advertising today targets consumers based on things they are passionate about, rather than simply their age or income bracket. That is, the increasing range of niche media now available enables carefully crafted messages to be designed for and delivered to specific consumer "passionate interest groups." For example, consumers who read Bon Appetit magazine (gourmet food coverage), watch the Food Channel on cable TV and hold Platinum American Express cards are likely to respond to messages that are centered on dining and entertaining well. Obviously, a niche campaign could be created around direct mail to these upscale credit card holders, combined with print ads in the magazine and cable TV ads on the Food Channel. This is a target marketer's dream come true. The product might be fine wines or Viking ranges, but it could just as easily be ads featuring Lexus luxury automobiles shown being used to bring home gourmet food ingredients, drive to a gourmet restaurant or arrive at the Aspen Food Festival. The campaign might be topped off with special ads or an online contest on the Epicurious gourmet foods web site (www.epicurious.com) and links to special offers, contests, how-to-cook streaming video demonstrations or useful news on the advertiser's own web site.

Blogs, podcasting, cable TV programming on-demand, mobile phone-based news and entertainment programming, satellite radio and online social networks are booming. Never in history have there been so many unique opportunities for targeted marketing based on consumers' tastes, interests, special needs and passions. In fact, asking consumers to respond by going to a specific web site page may finally make advertising truly trackable and results-based-long the holy grail of marketers.

Addressable cable TV technology makes television advertising directed at specific neighborhoods possible for the first time-a boon to advertising by local retailers, local services and political candidates. Interactive television services are growing rapidly, leading to new opportunities for direct-selling via TV. With interactive cable TV, subscribers can order movies on demand and other unique services. They also have the ability to respond to direct sales offers via their cable systems. For example, viewers watching a pay-per-view music concert may be able to order souvenirs such as t-shirts via interactive cable. Cable TV offers another unique advantage to direct sellers and other advertisers. Since the cable system knows the address of the cable subscriber, that address information can be matched against demographic databases to create a unique profile of the subscriber based on likely household income, value and size of the home and other data. Ads displayed by the cable system can then be custom tailored to match the viewer's profile.

Frankly, the use of ads that are intensely targeted to "passion interest groups" is long past-due. By one count, Americans are subjected to 3,000 commercial messages daily-most of which, such as billboards, occur randomly. A study by Yankelovich Partners found that two-thirds of Americans feel "constantly bombarded" by ads and nearly as many respondents felt that these ads have little or no relevance to them.

The competition among entertainment delivery platforms has intensified. Satellite radio delivery of subscription-based music and talk programming has hit its stride with gains in subscriber counts for Sirius and its competitor XM (the two may soon merge). Telecommunications companies such as AT&T (formerly known as SBC Communications) are now delivering television programming to the home via telephone wires, battling cable and satellite TV firms for market share. Millions of cell phone owners are subscribing to mobile video, enabling them to watch news, entertainment and sports on color cell phone screens.

Today, electronic offerings such as DVDs, digital video recorders (DVRs), video-on-demand (VOD) and MP3 players have vastly altered the way consumers enjoy entertainment. People watch and listen according to their own desires and whims. Miss the finale to a favorite television show? Rent or buy it on DVD, or record it to watch later. Interested in only one track from a recording artist's new CD? Buy and download just the one song via the Internet at iTunes. Love a prime-time drama on a major network but hate commercials? Record the show while ignoring the commercials with a DVR.

The implications of these changes are staggering. The business models upon which most media have traditionally run are becoming obsolete. Revenue from advertisers is in jeopardy at traditional outlets, while advertising at new media, including online, is soaring. Television programming schedules are losing relevance while electronic program guides are becoming more and more vital. Media companies and the advertisers that rely on them are being forced to radically change to deal with new technologies and new demands from consumers.

Rapid changes in viewing habits are already occurring. Network TV news, radio news and newspapers all find that they have to compete fiercely against Internet-based news content. A large portion of sports programming has migrated away from "free" broadcasts on TV and onto paid cable channels and pay-per-view systems.

Meanwhile, media platforms and ad delivery are evolving quickly. Multipurpose cell phones are now used for more and more entertainment purposes. Game machines are going multipurpose with the ability to connect to the Internet and play DVDs. Broadband to the home has grown to vast, mass-market numbers, while high-speed wireless connections are enhancing the use of entertainment and media on the go. A serious evolution of access speeds and delivery methods will continue at a rapid-fire pace, and media companies will be forced to be more nimble than ever.

In magazine publishing, some niche publications have been enjoying high advertising page counts. Fashion magazines and brides magazines, for example, remain robust. However, news magazines, business magazines and other broad interest publications are losing advertising clients to online and cable TV media, and are becoming thinner than ever. Newspapers are finding it increasingly difficult to compete against Internet news and advertising delivery rivals. Classified ads are migrating quickly to web sites such as Craigslist.com. Traditional radio broadcasting is suffering, finding it increasingly difficult to gather listeners for advertising-based radio programming due to such alternatives as satellite radio and MP3 players.

Advertising, long the main revenue source for much of the media industry, is supporting an entirely new industry: paid Internet search. Google, Yahoo!, AOL and other Internet sites generated close to $25 billion in online advertising revenues in 2007 alone.

Globally, more and more households are gaining access to the Internet, creating even more opportunities for online advertising. At the same time, millions of people are signing up for cell phone service for the first time, and many of those new cell phones have color screens capable of displaying entertainment and advertising.