Here's a very interesting post, based on an eDiets' earnings call. Basically it says that prices are going up in the world of paid search/online advertising and that may drive the company to do more traditional media buying. For some additional reasons (i.e., branding) Drugstore.com is making much of its media buy offline.
These posts illustrate that the world is not moving in just one direction. The Kelsey Group (among others) has discussed the challenges and imperative of developing more online inventory — local is an important component — and the inflationary price consequences of the failing to do so. The engines and portals are seeking to develop new inventory (for example, Ask's announcement creates new paid-search inventory and all the broadband video does too).
It's not going to be the case that traditional media will simply be vanquished by online. The future is much more complex than that facile assertion. There is obviously more to say about this complicated subject — later.