Speculation On a Second Internet Economy Collapse

TechCrunch reports that Lookery, a company specializing in selling ad inventory on social networks, is barely breaking even despite selling 3 *billion* ads per month.  And rather than raising prices to become profitable, they're actually in the uncomfortable position of lowering prices 40% -- from 12.5 cents to 7.5 CPM.  It reminds me of the (often unintentional) joke "We lose money on every transaction, but we make it up in volume!"

The article claims that Google's AdWord inventory is actually overpriced, and it's only sustainable so long that Google enjoys near-monopoly status.  Once that status is gone, then all keywords -- even the ones Google chooses to price out of the market -- become competitively priced, at rates far lower than what Google is currently charging.  Which means everybody that depends on AdWord revenue suddenly makes less.  Meaning the internet economy collapses.  Again.