I just spent a mind-expanding week at the Knight Center for Digital Media in Berkeley and was exposed to five programs — Photoshop, FinalCut Pro, GarageBand, Soundslides and Flash — along with 19 other journalists. I am not quick on the uptake. I grasped only a small amount of what was thrown at me by a patient training crew. But I did produce a Soundslide story and observed or assisted in a slew of other tasks. I got over my fear of video editing and realized that basic Flash was within my grasp. I have the confidence to get  the refreshers and advanced training that I would need to become a proficient multimedia journalist. I understand how to let the story choose its media, and have at least some sense of how to get the story done.

It was the longest six long days of training I’ve had in a good long while. And great fund. Only one point I heard caused me to disagree.  I think journalists have to invent (ethical) new ways to make money. A remark to the contrary at the end of the session is what prompted me to disagree. Professional journalists used to look down money-making. Someone else did that; ad sales or classifieds or circulation. But the old systems are eroding. If journalists don’t invent ways to get paid for their services they are doomed to extinction. Or so it seems to me.

A recent slideshow and speech by Google chief economist Hal Varian titled “Newspaper economics: online and offline” lays out the grim realities facing print news professionals, including the following:

Newspaper ad revenue is where it was in 1982 in inflation-adjusted dollars . . . paid circulation per capita is half what it was in the 60s.

A key finding in his analysis of online versus print news readership is time spent on news consumption. The online reader spends about “70 seconds a day, while the average amount of time spent reading the physical newspaper is about 25 minutes a day,” Varian notes in a blog entry. “Not surprisingly, advertisers are willing to pay more for their share of readers’ attention during that 25 minutes of offline reading than during the 70 seconds of online reading.”

I ran into Varian last week and asked what this means for print news professionals who hope to gain more e-readers as print subscribers dwindle.

First, he said, most of that 70 seconds of online news consumption occurs at work, so newsies will have to  engage the audience into consuming more news on their own time. That means making online news reading more like the habitual leisure activity that it is for print subscribers.

How will newsies convince the audience that the electronic news product is worth more of their attention? Varian thinks this will entail adding multimedia elements to make online news more engaging and entertaining. “You’ll be competing with television,” he said.

What a tough transformation for shrinking news staffs whose incumbents have few multimedia skills.

Thanks to my friend Howard High for alerting me to Varian’s analysis.

Kudos to the Progress and Freedom Foundation for assembling a thought-provoking book of Media Metrics (pdf) that argues “we have more media choice, more media competition, and more media diversity than ever before . . .  (if) . . . there was ever a ‘golden age’ of media in America, we are living in it today.” In a blog summary, authors Adam Thierer and Grant Eskelsen hope that, guided by this impressive compilation of tables and charts, “future debates on this subject will be be guided by facts instead of fanaticism and by evidence instead of emotion . . . hyperbolic rhetoric (and) shameless fear-mongering.”

Which fortunately leaves me free to heap derision and disdain on this bean-counting analysis that reeks of moral relativism like a chain-smoking French deconstructionist whose underarms have never been dishonored by deodorant.

Let me explain this seemingly bipolar view. I truly appreciate that this libertarian think-tank used its financial support from nouveau corporate media to pull together facts on everything from Internet advertising trends to magazine expansion (see niche breakdowns page 77) to the revelation, at least to me, that more than 3,000 free-circulation local papers have a “combined circulation . . . larger than all the daily newspapers in America.”

That seems impressive until you realize those are “shoppers” as we used to call such advertising-only weeklies when I was a small town businessman in Eureka, California, where the Tri-City Weekly was a fine example of that genre. So when the authors of Media Metrics call this a golden age of media, what they really mean is that this is a golden age of advertising. There has never been a better time for national and international brands to advertise goods and services. And that is not a bad thing until you consider that banks are failing, household debt is high, and “the U.S. is experiencing the worst food inflation in 17 years,” as MSNBC reported in April.

So one might fairly ask whether this more-is-better analysis makes sense when getting more media offer more temptation to buy more things with money we don’t have.

I especially enjoyed chapter six on “the natural decline in media localism” in which the authors make two contradictory arguments. First, they say, the “decline of ‘localism’ is much-lamented but quite natural phenomenon as citizens gain access to news and entertainment sources of broader scale and scope.” Translation – people are more interested in Paris Hilton’s life than in their own.

In the event, however, that our logic rejects this rather specious supposition, the authors offer a contradictory fall back — a 2007 University of Missouri report, “The Community Newspaper Study,” which offers statistics about satisfaction with local news coverage. The 2007 report is compares to a 2005 report to assure us that if we do decide to act locally instead of leer globally that we already have satisfactory local news outlets.

But from what little I know of statistics the Missouri report seems to lies somewhere between extraordinary anecdote-gathering and piss-poor statistical sampling.

For instance the report summary says: “In the 2007 survey, 505 interviews were completed with adults who lived in areas whose total population was 25,000 or less in the United States . . . in 2005, 503 interviews were completed with adults who lived in newspaper markets of less than 100,000 people.”

Even assuming that sub-25,000-person communities are the same as the sub-100,000 variety, how do we know that the communities surveyed in each of the two years are equivalent for statistical purposes, so that we can lump all 500 or so interviews together? And what is the margin of confidence on a sample that small?

We aren’t told, but come to think of it who cares! Paris Hilton’s videos are more engaging than the city council meetings I can watch on my local cable provider’s public access channel.  So thank you, Progress and Freedom Foundation, for giving me evidence instead of emotion, and for helping me realize that this is a golden age of media — in fact it is a golden shower raining down on civic-minded Americans from sea to shining sea.  

American households get an average of 118.6 channels of television but watched only 16 according to Nielsen’s annual “Television Audience” report. In summarizing the report MediaPost editor Joe Mandese writes:

“The finding suggests that while the supply of media options is expanding, consumer attention may have reached its limits . . . because Nielsen’s definition of the supply of channels “receivable” and “tuned” have served as a benchmark for understanding how fragmentation impacts consumer behavior as the number of media options expands.

What happens when viewers reach the saturation point? I guess we’re poised to find out.

I continue to be impressed with the signals that favor specialty media over mass or homogeneous media. For instance I only recently noticed the TNS Media Intelligence U.S. advertising summary for 2007. Overall the U.S. advertising market was flat with a 0.2 rounding error increase over the 2006 figures to bring the total spending  to $148.99 billion last year.

But niche media posted respectable increases: the Internet rose 15.9% to $11.31 billion; consumer magazines, the most web-like old medium, rose 7% to $24.43; even cable outpaced the GDP to rise 6.5 percent to $17.84 billion.

Down were the homogenizing media: network TV off 2 percent to $22.43 billion; spot TV down 10.2 percent to $15.59 billion; syndicated TV off 1.5% to $4.17 billion; local newspapers down 5.6 percent to $22.66 billion (how long before surpassed by Net?); and radio fell 3.5 percent to $10.69 billion.

I saved outdoor advertising for last. It rose 4.9 percent to $4.17 billion. Why? Not for its niche appeal but I would guess because of a general lessening of faith in the traditional advertising media. My guess is that outdoor benefits from advertiser confusion over how best to reach the busy consumer — catch them in a car staring out the window. Otherwise the winners allow for greater targeting and specificity and the losers are the unfocused aggregators of eyeballs.  

The market research firm Borrell Associates predicts today that online display advertising and search advertising are both poised to peak in a few years. The report, excerpted in Paid Content, says:

“The real growth story in internet marketing expenditures is going to be increasingly focused on online promotions.”

That neatly corroborates the notion I advanced yesterday that media has to move beyond simple advertising — and simple news for that matter — to recreate a value proposition for the 21st Century subscriber. And yes that suggests media will have to demonstrate some form of buy-in from its audience.

This may seem counterintuitive when it is difficult to get Web browsers to register their to get access to archives. And let’s be clear — we cannot turn back the clock and force people to pay for online news that they now get for free. The Wall Street Journal, with the richest niche in our global village, may remain the anomaly. The New York Times couldn’t make its readers pay.

So what is the answer?

Large media companies should become computer-assisted almanacs. Today they serve up the topical information of the day. As that commodity business dies they will have to get good at answering the burning questions of their subscribers such as when and where is soccer registration. That is my brief distillation of the 108-page report (PDF) produced by Stephen Gray of the American Press Institute’s Newspaper Next 2.0 project. Poynter Institute business analyst Rick Edmonds reviewed the report and wrote that:

“newspaper companies need to redefine themselves as the ‘local information and connection utility’ in their communities . . . a suitably big and audacious goal would be to create a wiki’ed “Localpedia,” comprehensive but built with volunteered user content.”

Startup media should imagine what kind of company or publication or community would they build around interactivity. That is the novelty. Stay close to interaction and it will lead to the new ways of making money. One set of suggestions as to how comes from cyberpioneer Kevin Kelly in his essay 1000 True Fans. In short, make yourself a minor celebrity to some group of people who will support you. In a follow up guest essay musician Richard Rich tells about living just such a life: “I’m my own booking agent, my own manager, my own contract attorney, my own driver, my own roadie. I sleep on people’s couches . . . ”

Okay, so he never promised you a rose garden. The point is that one-way media and its advertising-centric business models are dead or dying. Two-way media requires engagement. With so many stars in the entertainment or information universe why does the audience frequent your outlet?

Encourage the habitual visitor by providing easy ways for them to interact (I wonder how to do that in the context of a solo blog — comments are so laborious and they expose the writer — suggestions ????).

Then think creatively about what financial support might attach to those interactions. If the Borrell report cited today is correct the market is already moving towards two-way promotional activity and away from one-way advertisements. Will profit follow interactivity? That is the hope.

Were the Nickelodeons YouTube 1.0?

Before World War I when newspapers were reaching new readers as rising literacy and the rapid offset press created a mass audience for news, Joseph Medill Patterson co-edited the Chicago Tribune with his cousin, Robert R. McCormick. Patterson, who left Chicago and went “over there” to serve on the front during “the war to end all wars,” returned to the United States to found the New York Daily News which he modeled on London’s tabloid Daily Mirror. Oh for the days when newspapers sparked with sass in contrast to these feeble times when dysfuntional journalism, brain-dead ownership and technological change have transformed print into a toothless lion feared mainly as a potential vector for diseased fleas.

In any event back when newspaper journalism was young, back even before Patterson became an industry muckety-muck, he wrote an article that the Saturday Evening Post published in 1906. Titled “The Nickelodeons” it described the phenomenon then sweeping the nation –  cheap theaters that showed silent films whose sound track was generally supplied by some sort of player piano. Patterson, then 28, was curious about the allure of these literally dumb and often pointless pictures — early nickelodeon “films” might be no more than a fire engine racing to scene. This is  priceless journalism that arcs across a century to let us see how this savvy and business-minded man viewed the challenge that moving-pictures posed to print’s hegemony on consciousness. Patterson writes:

“Civilization, all through the history of mankind, has been chiefly the property of the upper classes, but during the past century civilization has been permeating steadily downward.”

Patterson’s prose is a bit florid for modern tastes and the politcally correct will have to get over their bad selves to appreciate his genius. Here is a founder of the “yellow press” – doubtlessly despised by haute culture — as he regards a medium that delivered information without the requirement of literacy. At a time when the U.S. population was roughly 92 million, Patterson wrote:

“Incredible as it may seem, over two million people on average attend the nickelodeons every day of the year, and a third of these are children . . . In cosmopolitan city districts the foreigners attend in larger proportion than the English-speakers. This is doubtless because the foreigners, shut out as they are by their alien tongues from much of the life around them, can yet perfectly understand the pantomime of the moving pictures.”

 The piece offers insights into what we would call the business model of the nickelodeons — for instance they had just 199 seats because theaters of 200 or more had to pay prohibitively-high fees. But I am in a time-crunch today, my internet is down at home and I am at the local coffee shop hurriedly banging out a linkless version of this posting in order to leave you the following thoughts that Patterson pounded into a typewriter 106 years ago:

” Those who are ‘interested in the poor’ are wondering whether the five-cent theatre is a good influence, and asking themselves gravely whether it should be encouraged or checked (with the help of the police).”

But Patterson, whose rambunctious News mocked its pompous New York competitor, the Times, obviously dissents as he concludes the article:

“Whether for weal or woe, humanity has ceasely striven . . . to know more and feel more of both good and evil, to attain a greater degree of self-consciousness . . . In this eternal struggle . . . the moving picture machine, uncouth instrument that it may be, has enlisted itself on especial behalf of the least enlightened, those who are below the reach even of the yellow journals . . . The nickelodeons are merely an extension course in civilization, teaching both its ‘badness’ and its ‘goodness.’  They have come in obedience to the laws of supply and demand.”

(Tomorrow: so what has that got to do with anything?)