Phil Wainewright has a compelling article on his ZDNet blog, arguing that the recent acquisitions of online advertising companies by the bigcos (Google, Microsoft, et al) is evidence that the current era of the Web is in a bubble. He notes:

"Today, we're starting to understand that the Internet is going to fundamentally alter the way businesses promote their wares to prospective customers. So the entire online ad business is getting snapped up at (literally) any price. Even though the buyers have no clue what it is they're trying to buy. All they know is that if they don't buy it, someone else will.

What they're really trying to buy into is the webification of advertising."

Phil rightly notes that before the Web came along, advertising was a totally disconnected activity. But now, the Web enables personalization of marketing messages and the ability to track the success of that. The companies that are being snapped up - DoubleClick, aQuantive and others - have built online advertising solutions that have achieved a certain amount of network effects. But Phil argues that they won't scale as much as the "over-inflated" prices that Google, Microsoft et al paid for them indicate.

Interestingly, Phil points to a Read/WriteWeb post last week to hammer home his point:

"There's value in interpreting the information, but to realize that value they have to share the information rather than walling it in. There was an insightful article on Read/WriteWeb the other day, discussing the potential to build an open ad network on the Web.

This is not only Google's vulnerability, it's the prick that is set to burst all the over-inflated deals of the past few weeks."

I think Phil has a point there. The Web has always been good at cutting out the middleman - and the likes of DoubleClick and aQuantive are quintessential middlemen, of the online advertising age. An open advertising network, such as Sean Ammirati suggested, is one way of routing around the middlemen.

Also let's not forget that online advertising is so far the only proven business model for most startups. That's no doubt fueled some of the recent feeding frenzy between Internet bigcos over online advertising companies. But the Web has yet to fully embrace alternative business models - subscriptions, micropayments, etc.

As for the big question, is the recent acquisition fever a sign of a bubble? There's definitely a whiff of panic about the recent deals - or more accurately, fear of Google (who started the feeding frenzy by buying DoubleClick last month). It also seems like a game of Follow The Leader, which is of course Google. As Sean suggested and Phil backed up, there is potential for an open network to disrupt the online advertising industry. And I wouldn't discount the rise of alternative online business models either, even though they haven't been successful so far. What do you think?