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True to its upbeat ways, Piper Jaffray, the uber-optimistic financial services firm to the Internet industry , is back again with a 425-page report called “The User Revolution: The New Advertising Ecosystem and The Rise of the Internet as a Mass Medium.”

Wow. Big words, among other things, it also invented a new word “Communitainment” (See Point No. 3) to feed the raging flames of Web 2.0. Key findings from this report (which dun seem to be privy to nosey folks like me):

We expect global online advertising revenue to reach $81.1 billion by 2011, representing a 21% CAGR (2006-2011).

The User Revolution. The advertising world is going through a revolution, one that we call the “User Revolution” as it is happening primarily with the consumers, who are taking control of content consumption and branding. We believe this trend will cause a significant rise in prominence of the Internet as a major content consumption and marketing medium.

“Communitainment.” The Internet has increasingly become a principal medium for community, communication, and entertainment–three areas that have collided together and are impacting each other’s growth–generating a new type of activity that we call communitainment.

The Internet Is Mainstream. The Internet has become a mainstream media outlet that now rivals traditional media for reach and advertising dollars.

Media Fragmentation. The proliferation of online and offline media outlets has resulted in shrinking television audiences and an increasingly fragmented media landscape.

The Golden Search. We believe search continues to gain ground, driven by the rise of search as the New Portal, the increasing use of search in branding campaigns, and the local search opportunity.

We believe Google’s wide variety of non-search-related products creates a virtuous cycle of brand affinity that drives incremental search volume.

Video Ads Could Drive The Next Wave. We believe Internet video ads could become a game changer for large brand advertisers, who are used to the 15- or 30-second TV commercial

Internet Usage Patterns Are Changing. Portals maintain the highest reach, but the fastest growing category of destinations is communitainment sites such as MySpace and Facebook.

Ad networks are experiencing increased demand due to increasing Internet fragmentation, desire for more targeted inventory, increasing usage of networks for branding, and increased site visibility.

Agencies are rapidly evolving into more sophisticated, technology-savvy entities that combine best of breed offerings.

Watch These Companies. We espect companies such as Google (and YouTube), Yahoo!, Disney, News Corp, Time Warner, Microsoft, InterActive, Facebook, Craigslist, Brightcove, Yelp, SINA Corp., Baidu, aQuantive, ValueClick, 24/7 Media, Netflix, Wikipedia, MobiTV, Digg, and Hakia to be the most important players to watch.

Is there something you do not know here? While this report incorporates China’s major internet players, Kaiser Kuo of Ogilvy China is sceptical on the gross revenue figures due to the small size of China’s internet revenue base, despite impressive growth percentages.

I prefer to focus on ONE important trend mentioned. Of consumers taking over brand perceptions on the web. The online revolution has given a voice to the long-suffering consumers of many companies and I believe the uproar over some malpractices and product quality of companies that we have seen from Edelman’s Walmart disasters, Dell Hell is only the tip of the iceberg as consumers learn to band together and organize themselves. Two-way communication services such as IM and blogs will continue to be even more embedded in the service infrastructures of companies (the Customer Support department), product development processes to incorporate feedback and make pre-market testing more transparent and effective by giving sneak peeks to alpha consumers or bloggers. Marketers will also do well to start fine-tuning their advertising plans. This does not extend to 30-second TV commercials or the online equivalent of banner ads or video ads. They need to look at more interactive and engaging medium, perhaps Second Life properties for more immersive experiences, more advertorials in major online blogs and media outlets - essentially have higher visibility and presence to minimize the communication distance between corporate and consumer.

In response to the new word “Communitainment”, i will also invent my own - The Blogsumer (Blogger + Consumer).

Watch out, corporate world.