The "valuation" appears to be based entirely on what could be earned by adding as many advertising links as possible and maintaining the existing level of traffic.

The premise that one can arbitrarily take any existing website, load it with popups and Flash ads, and maintain traffic unchanged is IMO an example of sheer stupidity, unless existing visitors are overwhelmingly "sheerly stupid" (which is not necessarily an untenable assumption for many websites).

I think I see a sales pitch for someone selling webspace advertising here. As with most advertising and for most advertising agencies, reality seldom intrudes.

John