For some time, Procter & Gamble, the world’s largest advertiser, has been dipping its big toes into the vast pool of Facebook, now the world’s largest social network. I recently knocked on the doors of both companies to hear how the experiment was going. Neither was inclined to say much.

Independent experts on Web advertising have been watching, however, and what they see is a myriad of difficulties in making brand advertising work on social networking sites. Members of social networks want to spend time with friends, not brands.

When major brands place banner advertisements on the side of a member’s home page, they pay inexpensive prices, but the ads receive little attention. Seth Goldstein, co-founder of SocialMedia Networks, an online advertising company, wrote on his Facebook blog that a banner ad “is universally disregarded as irrelevant if it’s not ignored entirely.”

When advertisers invite members to come to pages dedicated to their products, they can attract visitors only by investing in expensive creative material or old-fashioned promotions like prize contests.

And when they try to take advantage of new “social advertising,” extending their commercial message to a member’s friends, their ads will be noticed, all right, but not necessarily favorably. Members are understandably reluctant to become shills. IDC, the technology research firm, published a study last month that reported that just 3 percent of Internet users in the United States would willingly let publishers use their friends for advertising. The report described social advertising as “stillborn.”

All Web sites that rely on ads struggle to a greater or lesser extent to convert traffic, even high traffic, into meaningful revenue. Ads that run on Google and other search engines are a profitable exception because their visitors are often in a buying mood. Other kinds of sites, however, can’t deliver similar visitors to advertisers. Google’s own YouTube, which relies heavily, like Facebook, on user-generated content, remains a costly experiment in the high-traffic, low-revenue ad business.

Financial data would show the current state of Facebook’s advertising, but none are available. Facebook is privately held and a spokesman told me that it does not disclose revenue or any information about its ad sales.

The Pulitzer Prize Board, the governing body behind American journalism’s highest honor, has announced that online-only newspapers will now be eligible for the Prize. The announcement comes as many traditional media outlets are struggling – the Tribune Company filed for bankruptcy today and The New York Times is borrowing against its Manhattan headquarters – and affirms the increasingly important role that online news outlets are playing in today’s news cycle.

The new requirements stipulate that entries come from:

“a text-based United States newspaper or news organization that publishes—in print or online—at least weekly during the calendar year; that is primarily dedicated to original news reporting and coverage of ongoing stories; and that adheres to the highest journalistic principles. Printed magazines and broadcast media, and their respective Web sites, are not eligible.”

But what exactly is an “Online-Only Publication Primarily Devoted to Original News Reporting”? The release and relevant FAQ section shed little light on the matter, offering the following:

Q: Can you give examples of online-only newspapers that would qualify?
A. A growing number of sites, such as MinnPost, Voice of San Diego, St. Louis Beacon and Washington Independent, do original reporting. But it is premature to discuss eligibility before an entry has actually been submitted.

These broad guidelines give the Pulitzer’s governing Board some flexibility for judging entries as it tests the muddy waters of online content. But it leaves the doors open to seemingly absurd possibilities. Among the first to come to mind: what if someone won a prize for a Tweet?

Given the growing importance of Twitter during breaking news events, it is becoming increasingly possible that we will one day have a “Tweet heard round the world” – a 140 character message that breaks a news story of global significance. One that will be repeated ad nauseam across cable news networks and major newspapers – perhaps emerging as a candidate for the Pulitzer under the new rules. Far fetched? Sure. But not impossible. How about a series of Tweets?

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