We spend a lot of time at Mashable. It’s Santa’s sack, a bottomless source of Joy and Wonder. Only the other day it wasn’t the usual flow of interesting curated content that piqued my interest. It was a banner ad by Google for their Watch This Space campaign. Intrigued, I played around with the ad, followed the links, did a bit of research, and it’s truly fascinating stuff. It probably herald’s the dawning of a new age in online advertising, where the ad could be more entertaining, interactive and engaging than the content it’s paying to be next to.

It’s not out of the question. The technology is making that little space incredibly versatile. Gone are the days of flashing, annoying boxes that paid their way by intruding on the browser’s experience and were valued in terms of cents per thousand. Now the ad is everything that is the best of the web.

Google is taking this seriously. You only need to read through some of what’s on their blog to realise just how accessible they’re trying to make these powerful tools. And they’re taking the right approach. The behemoth may no longer be the upstart of the internet, but they have ethos, experience and money, which are a lethal combination. Look at the philosophy behind adwords and give it a million times more power and versatility. Ads of the future will be tailored to make them of interest and relevance to you, and of maximum value for money for the advertiser. The customization they’re capable of is awe-inspiring. It’s like sharks with frikking laserbeams. And it’s no wonder they’re getting all beefed up. According to their presentation at the IAB MIXX Conference and Expo listing their 7 predicted Trends for Online Display Advertising by 2015, it’s gonna be a $50 billion industry. A lot of people are gonna be looking for a slice of that pie and the shark with the biggest laserbeam will get the most of it.

But that’s only the start of it. They also predict buying and selling space in real time. Does that mean there could be a burgeoning futures market for advertising space next to popular posts and sites? A spin off industry more Wall Street than Silicon Valley where guys profit on buying space before it becomes popular? Could people be trading futures on adspace?

More than anything though, this raises another question. None of this works unless the browser is fully integrated into all the systems and services online that the Online Display Ads take for granted. The online shopping, social media usage, and all the other bits and pieces. It’s a big assumption, but one Google are clearly willing to bet heavily on. Which means that by the time this becomes the norm, your online behavior and persona will not only inform the advertising and branding you’re exposed to, but also the way in which it interacts. Your digital environment becomes an extension of your identity.

All in all, it’s exciting stuff, if only because their interest in it shows that the event horizon where social and advertising merge to the point where you can’t really distinguish the one from the other is closer than we may think.