A year ago, the conventional wisdom said that the online advertising market would still grow in an economic slump because online ads were cheaper and more effective.

And they are. But if the slump is big enough– like the one we’re in now–then all bets are off.

Which is why there’s no longer any conventional wisdom about the future of online ads. Two data points, and one anecdote:

• J.P. Morgan (JPM) Internet analyst Imran Khan has reduced his projections for ad growth for the second time since September. But he’s still projecting growth. In fact, Khan sees overall spending, fueled by search ads on Google (GOOG) and Yahoo (YHOO), growing 13 percent in 2009, down from a previous projection of 19 percent. But he thinks display ads will fare much worse, noting U.S. spending on display will only grow six percent in 2009, down from his earlier forecast of 16 percent.
• Ad network optimizer The Rubicon Project reports that the average price for an online ad at “thousands of sites and 270 ad networks” dropped 11 percent in the last quarter. But since it can also find evidence of prices increasing at some sites–news and reference sites, for instance, increased prices 36 percent–Rubicon argues that things aren’t so bad after all.
• Gawker Media publisher Nick Denton thinks everyone who doesn’t see misery next year is delusional, period. The man behind sites like Gawker, Gizmodo and Valleywag happily offered this insight at the Silicon Alley Insider/Founder’s Club event last week, which was packed with digital movers and shakers. All of them should be terrified, he said, charmingly: “Anyone who isn’t prepared for ads to go down 40 percent is crazy.” Obligatory disclaimer here: Denton is always seeing doom just around the corner. But he’s very convincing.

Want a (slightly) more upbeat spin? Here’s Khan’s executive summary:

* Overall ad budgets continue to weaken. Since we reduced our estimates on September 4th, we have seen a further slowdown in the economy, particularly in the last two weeks of the third quarter. Weakness continued into October and spread from the US and UK throughout continental Europe and Asia. Additionally, dollar strength was greater than expected which will further depress growth rates. We are now basing estimates on a $1.25 exchange rate vs. our prior base of $1.40. Our updated model calls for total online global advertising growth of 25% in F’08 and 13% in F’09 vs. our prior estimates of 28% and 19% Y/Y growth respectively.

* Deterioration of display advertising is more pronounced than expected. Our channel checks are showing that sell-through is declining. Additionally, so far CPMs for premium inventory are flat to slightly down. Looking forward, we think CPMs will remain depressed and sell-through rates will worsen.  As a result, we are lowering our F’08 and F’09 domestic display estimates to $7.95B (11 percent Y/Y growth) and $8.45B (6% growth) from $8.15B (14% Y/Y growth) and $9.43B (16 percent growth). We are now modeling F’08 global display ad growth of 14% Y/Y vs. our prior estimate of 16% growth.

* Search performance held up in 3Q but we expect ad budget cuts to bleed through. We continue to see performance-based advertising holding up better than banner advertising. Long tail advertisers continue to allocate additional dollars to search. However, keyword price inflation is moderating. Additionally, we think marketing spend pullback in some segments including travel, telecom, autos, and retail is worsening. As such, we are lowering our domestic F’08 and F’09 search growth estimates to 23.4% Y/Y and 17.3%, respectively, from 27.4% and 25.5% Y/Y growth. We are modeling F’08 global search ad growth of 34% vs. our prior estimate of 36% Y/Y growth.”