Amazon.com Inc.’s (NASDAQ: AMZN) ad revenue may reach $835 million this year and could be well above $1 billion in two year’s time. The news does not just speak to the power of online marketing. It extends to the ability of an Internet firm to collect data about its customers and their habits to target ad messages, which is another example of how new media continues to add tools to trump old media. That means old media will continue to lose market share in the overall national and local advertising market. It is hard to imagine, but Amazon’s ad revenue probably will pass that of The New York Times Company (NYSE: NYT). The New York Times may be the single best proxy for old media. The Amazon ad business is nothing more than an afterthought compared to its e-commerce model, whereas for old media, it is a critical measure of its future.

The New York Times posted total ad revenue across all of its properties of $191 million in the first quarter, and that was down 11% from the same quarter of last year. If the newspaper company is fortunate, its ad revenue will reach $800 million this year. The Times also can count on subscription revenue, which should reach $1 billion in 2013. But the growth of this second line of revenue may not balance the drop in ad revenue. To make the Times problem even worse, last quarter:

Print and digital advertising revenues decreased 13.3 percent and 4.0 percent, respectively, largely due to ongoing secular trends and an increasingly complex and fragmented digital advertising marketplace. In the first quarter of 2013, digital advertising revenues were $46.5 million compared with $48.5 million in the 2012 first quarter.

Digital advertising was supposed to be part of the recovery of the Times revenue. Clearly it is not, nor is it likely to be.

Most of Amazon’s revenue in the short term will continue to be from its extraordinary e-commerce operation. However, the company expects its Amazon Web Services (AWS) revenue eventually to match that of its e-commerce business. And Amazon founder and CEO Jeff Bezos has a history of milking every dime he can out of his company’s operations. Advertising is just the most recent example.

eMarketer, which provided the Amazon ad forecasts, provided an analysis of why the revenue from this new business may expand:

Amazon has already developed its targeting technology, along with creating its own demand-side platform (DSP) to improve targeting of Amazon buyers on other web properties and devices like Kindles — something that may help position them as a more attractive site for both brand and direct response advertisers.

The Times has none of those advantages, and neither do any of the media companies like it.

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