Evan Hessel and Taylor Buley, 04.29.09, 01:00 AM EDT

A start-up says it can figure out what's powerful or pointless. Time for struggling online publishers to worry?

LOS ANGELES -- Advertisers spend nearly $8 billion annually pumping trillions of ads into boxes and banners across all other corners of the Internet.

Who actually looks at all that stuff?

Other ads get better placement, Hulett says, but suffer from such confusing text or dull graphics that readers never so much as pause their cursor on them.

Mpire, Hulett's Seattle start-up, just unveiled a new Web application designed to help marketers cut out such wasteful and pointless ad spending. The service, called AdXpose, allows advertisers to track precisely where on individual Web pages their ads land, how long they are visible and whether readers' cursors linger over any particular ad box.

Jones Soda ( JSDA - news - people ) and Viacom's ( VIA - news - people ) MTV Networks are among the first advertisers to use AdXpose to track their online marketing expenditures.

Mpire's ad analytics are among the latest and most powerful in a growing market for applications tracking how marketing dollars are spent online. Since 2004, the Interactive Advertising Bureau has maintained technical standards mandating how display ads should be tracked online. PricewaterhouseCoopers, Deloitte & Touche and ABC Interactive offer tools for auditing online ad campaigns.

Outfits like Mpire may prompt a reshuffling of online ad dollars at a time when many Web publishers are fighting to stay alive. Microsoft ( MSFT - news - people ) just announced a 16% drop last quarter in online ad revenue, compared to a year ago. At the New York Times Co. ( NYT - news - people ), Web ad sales dipped 6% compared to 2008.

The demand in ad tracking outfits is a direct result of gradual changes in the way ads are bought and sold online. During the early days of the Web, advertisers knew exactly where their ads appeared because they negotiated directly with Web sites' salespeople. Direct sales practices still dominate at big Web publishers, such as the digital arms of newspapers and broadcast television networks, but they are losing market share to third-party ad brokerages.

For legions of small Web publishers, ad sales occur through one of 400 or so networks, which purchase bulk ad space from Web sites and resell it to advertisers. Today, 80% of Web ads are sold through such brokers.

Advertisers often use several different networks to reach their target consumers across countless niche Web sites, blogs and social networks. Keeping track of where every ad lands and who sees it is a seemingly impossible task.

Launched in 2005, Mpire first developed WidgetBucks, an application that helps Web publishers compare cost-per-click prices among advertisers to find the most lucrative ad deals.

Hulett recently offered advertisers in the WidgetBucks program complimentary ad auditing tools. Marketers used the tool so much that he decided to rebrand it as AdXpose and offer it to advertisers unaffiliated with WidgetBucks.

Mpire is far from the only enterprise pitching ad-tracking products. Still, Hulett bets he can win over advertisers with sophisticated analytical technology. AdXpose embeds a Javascript tag into each ad and tracks the Web address of each page where the ad appears, along with the placement on the page.

The tool also measures if the Web users let their cursor wander over the ad. Hulett calls this procedure "heat-mapping," and provides the resulting data to advertisers in real-time.

How will new insight into the precise placement of ads affect the fate of digital media companies?

Hulett says his product is unlikely to suck significant Web revenue out of big publishers like the digital arms of newspapers, magazines and TV networks, as those firms collect the bulk of their revenue from direct sales of premium ads placed at the top of Web pages.

The biggest impact could be on social networks like Facebook and News Corp.'s ( NWS - news - people ) Myspace, as well as blogs, Hulett says. Purveyors of so-called "user-generated content" are among the booming ad network industry's biggest suppliers of inventory. Once advertisers realize how much of their Web budget goes to ads running at the bottom of humdrum personal profiles and blog posts, Hulett predicts brands will find other places to spend their money.