Now the question is, how do you combat it?
In some ways, the internet can create an insular, closed of society of its own that may or may not reflect the real world. In the case of propaganda that is spread via the "new media", it is very true that those that imbibe may in fact believe that the real world does not reflect the reality. Until, of course, it does.
This is the same concept that sometimes has left and right bloggers working in a box. They can become closed off, particularly if they think traditional media has nothing to offer.
How does the insular internet world become effected by the real world? By real world happenings.
An example, though not using the internet, would be the propaganda of Saddam's regime during the invasion of Iraq and the subsequent drive to Baghdad. "Baghdad Bob" continued his propaganda and was nearly effective in creating at least a fog over reality until an American tank was seen driving behind him into al Fardos square.
In the case of Jihadist internet propaganda, the first blow can only come when reality is so obviously different than the propaganda that these internet sites lose the trust of their usual adherents.
It is unlikely that we will get something so obvious as the tank in the square incident in the near future to damage these propaganda outlets. However, each day they can be whittled down. One of the most important "reality" v. "propaganda" actions was the capture of al Mashahdani and his confession that Omar al Baghdadi does not exist. Of course, we do not know what all of the jihad websites are saying. They could be claiming that Mashahdani was coerced or drugged or otherwise dubbed to make that statement. However, this is coupled with the fact that the Ba'athist insurgent network TV coming out of Syria said several months ago that they did not know this "al Baghdadi" and they would not swear allegiance to him. The entire issue is confirmed with Mashahdani's confession and is probably helping to destroy the veracity of many jihad websites not to mention accelerating cooperation by Iraqis.
Still, what do you do about the internet jihad globally?
The reporter says that we cannot do "nothing". That is correct. The military has recently stepped up and began putting their own internet videos up of failed attacks by the jihadists and ferocious attacks on the enemy. That is one aspect of this internet war.
Beyond that, the real world will eventually reach the internet world. Events on the ground will show the propaganda is false and the credibility of sites, organizations and leaders will be damaged. If Iraq becomes relatively peaceful, there are limited attacks and it prospers while Al Qaeda is beaten back there, it will be a bad time for AQ and the internet jihad wannabes.
Still, a comprehensive program for combating terrorism in the "new media" would go a long way towards speeding up the demise of such programs and, thus, damage their ability to recruit.