It's clear that advertising agencies are deeply conservative. They are not willing to put money into experimental media

Irwin Manoim

In recent months several prominent web publishing operations have crashed.

Others, even the big ones, are clearly in trouble - treading water with mergers and staff cuts. Two of the main players, M-Web and iAfrica, have delisted from the Johannesburg Stock Exchange.

In March this year, Broadcast Interactive Group (BIG), an internet venture with the backing of several radio stations, closed before it was properly off the ground.

Woza

This month, Woza, one of the most successful independent content operations to survive without other media partners, wilted and died.

Irwin Manoim: The core problem is the failure to attract advertising

Now the Daily Mail and Guardian (DM&G), Africa's first online newspaper with a solid international reputation, is facing an uncertain future.

The online version of the weekly Mail and Guardian recently quizzed readers on whether they would be prepared to pay subscription fees, announcing it was "re-examining the way it does business. It's either that or perhaps go under."

No-one talks of profits, but of who is losing more than whom. Says DM&G's acting editor David Le Page: "If you compare us to the big players like Independent Online (IOL) and news24.co.za our losses - R1.3 million in the past year - are tiny."

Losses

But everyone, including DM&G owners M-Web and The Guardian, has grown tired of the internet's losses, no matter how small.

Woza chief executive Kevin Davie, who claimed a page impression rate of 5.5 million a month, says Woza was just six months away from making a profit.

Nevertheless, its main investor, Bytes Technology Group, took the cue from other companies around the world and pulled out.

And online journalists are just some of the casualties of the investor swing from over-zealous to downright phobic.

"Staff have been living with a sense of uncertainty for such a long time," says Mr Le Page.

"It's difficult to feel even more demoralised. But we're still having fun on a daily basis. Running the damn thing is what keeps us going."

Ad problem

Irwin Manoim, founder of DM&G and director of the recently-bombed BIG, believes "the core problem for everybody is the failure of the internet to attract advertising.

There's no other reason why our sites couldn't work. They got the audiences and were backed by other media. It's clear that advertising agencies are deeply conservative. They are not willing to put money into experimental media."

It is common cause that banner advertising has failed.

"The problem with the banner is it requires you to go somewhere else," says Manoim.

The move towards using new advert displays that stay on the page and offer information to the reader at first glance has yet to take off here.

Not for profit

Growth in online advertising in the near future is unlikely, according to a recent PricewaterhouseCoopers report which predicts that online advertising in the United States will drop from an estimated $20.3bn to $15bn in 2004.

According to the report, click-through rates on banners have dropped from 0.9% to 0.3% in four years. South Africa is experiencing the same downward trend.

The irony, says Mr Manoim, is that the internet is advancing technologically and audiences are still increasing.

But unless web publishers perch on a never-ending money pile or have managed to tap lucrative niche markets like the business community - such as two local success stories, Moneyweb and ITweb - they too will be casualties of their time.

For the near future at least, the advance of the internet on the continent Africa is likely to rest more on the efforts of non-governmental organisations or the determination of governments than the endeavours of profit-starved commercial online ventures.