Could advertising agencies be facing the same fate as blue jean manufacturers? It’s a possibility raised in a recent Wired News article about a new site called Adcandy, which allows the public to contribute their original advertising ideas. In doing so, the sites’s founder, Per Hoffman, wants to tap into one of the great strengths of the Internet: it’s power as a collaborative tool that unleashes the creativity of so-called amateurs. “People want to participate in all forms of culture, so why not commercials, for better or for worse?” says Hoffman.

Contributors can win cash prizes from $50 to $500 for their phrases or campaign ideas, which prompts Carrie McLaren of Stay Free Magazine to suggest another power of the Internet: it’s ability to demolish the economics of long-standing business models. “It’s safe to say that $50 for a winning idea would be comparable to sweatshop labor in the advertising world,” observes McLaren.

The challenges facing advertising agencies in the Internet age are well documented. Their business model, evolved over the last century, is to develop creative for brands with big budgets. Their primary revenue stream has become the fees they tie to a percentage of a media buy, which principally means television. With brands and budgets in flux, and new media both challenging television and offering skinnier percentages for media buys, could agencies be vulnerable to the transformative economics of “sweat shop” labour that have ravished other industries?

Before envisioning hordes of black turtlenecks on street corners with (elegantly designed and hip) signs reading “killer creative for food,” you may want to check out Alan Deutschman’s article in Fast Company about Wenda Harris Millard, Yahoo’s chief sales officer, who’s responsible for bringing big-brand advertisers to the Web site.

Deutschman leads with the statement that: “traditional advertising is in deep trouble,” but goes on to observe that: “The Web always had the potential for reinventing and reinvigorating advertising. With its unique ability for measurement — tracking who clicked on an ad and how they interacted with it — the Net promised to solve the classic problem stated by department-store pioneer John Wanamaker: ‘Half the money I spend on advertising is wasted; the trouble is, I don't know which half.’ But in its early years in the 1990s, the Web couldn’t deliver the mass audiences needed by national consumer brands. Lately, though, Millard has been instrumental in showing Madison Avenue that the Internet has developed the audience reach, the technology, and even the creative ferment to realize its great potential.”

Whew, it looks like the agency model is safe. Or we could discover that shouting “wassup” really is as easy as it looks.