According to entomologists, it took nature 4.3 billion years to create the unprepossessing earwig. This is important only because some other scientists tell us today’s computing devices – the one in your pocket, under your arm, or at your desk – have about the same intelligence as an earwig.

Here’s where it gets interesting. The first semiconductor devices – “chips” with more than one circuit imprinted upon them – appeared 42 years ago. If we compare the evolution rate of the chip to that of the earwig, we get a ratio of 0.0000000097:1. That is, for every year it took to evolve the bug, it took a ninety seven hundred billionth of a year to evolve its electronic intelligence partner. If this rate continues, we’ll see chips as intelligent as we are within a decade, by 2023.

What would a world where devices are as smart as we are look like? It is impossible to envision any more than our great-grandparents could foresee the impact of plastics, automobiles, or airplanes. We are chained to the attitudes and realities of our past. Psychologists tell us that less than 1 person in 10,000 can foresee a future that’s very different than the present. Here are some examples:

• In the 1850s a renowned scientist predicted that human travel by rail would prove impossible because no one could survive speeds greater than that of a fast horse.
• In 1927 a prominent economist predicted that, if telephone connections continued to grow at then-current rates, by 1948 one in three Americans would be employed as a switchboard operator.
• In 1950, the president of IBM predicted that five computers would be sufficient to service all computing needs of North America.

Track record aside, we have to make the effort to foresee the future. Our grandparents had nearly a century to create their future. We may have less than 12 years – and parts of the future will come sooner than that. Think of how quickly the world has turned already. In the early 1990s we used acoustic modems to access AOL at a BAUD rate of 300 bps from computers that ran DOS and sported 10-megabyte hard drives. A few years later, the future of the Web as an advertising medium was still the subject of debate. Today, we have watched online disrupt newspapers, magazines, the Postal Service, book publishing and the record industry. Mobile devices promise to eliminate demand for cameras, end landline phone communication, and change the way people shop. What will next year (and the year after that) add to the list?

Here are suggestions to help your company anticipate the future:

1. Determine the parts of your business model that make your organization successful.
2. Evaluate each according to its vulnerability to change. Use scale where 1 indicates “least vulnerable” and 5 indicates “least vulnerable.” Don’t wear blinders. Don’t limit yourself to changes that have happened already. Imagine changes that have yet to occur but which seem logical based on your experience.
3. Estimate how your organization would be affected if the business model elements you rated “1” were swept away by future change.  That’s right. Base your future survival plan on changes to the elements you think have little or no vulnerability. After all, it’s not the anticipated changes that hurt.
4. Engage the best minds to help you create a plan to react to and survive the change you’ve identified.
5. Repeat this exercise. Re-evaluate your scores often. When you can’t think of anything new to add, ask others to help.

When you’re done, if you’ve done a good job, you will have developed a survival plan. Of course, you’ll never really be done. But you will have a good idea of what the future is likely to bring.

Back then, the general assumption was that anybody who wanted to use a personal computer would have to know how to program. Osborne aggressively challenged that premise, and predicted that in the future less than one in ten PC users would be programmers. His statement caused furious debate at the time, but these days it’s just limpid fact. Most people happily surf the Web, check their e-mail, compose text, construct spreadsheets, play games, and do a thousand other things – all without writing a single line of code themselves.

Cycle forward to today … and tomorrow. Both Apple and Microsoft have announced big changes to their next operating system releases. The announced changes will make both feel more like tablets than desktops. Both will offer access to apps, those nifty micro-programs that are so much fun to use, so easy to get, and so cheap that nobody minds dumping those no longer useful or used.

Here’s a prediction: by 2016, most computers available to consumers are going to look and act just like today’s iPhones and iPads. That is, they will be able to communicate like cell phones, they will all have built-in GPS, and they will feature cameras and touch-screen interfaces. Most importantly, they will depend on apps instead of expensive, pre-loaded software for the functionality users will want. In fact, what we now call computers will have largely faded from the scene – except for some business and gaming applications. Personal computers will be replaced by mobile devices of one sort or another.

I don’t expect the kind of pushback Adam Osborne got for his prediction. For one thing, what I’ve described is already beginning to take place. Tablets and smart phones are replacing desktop computers and laptops in many homes and businesses. The app business is thriving, with hundreds added to “app store” inventories every month. All indicators point to a post-computer future. Your children’s kids will wonder what a computer desk was for.

The cloud will grow in importance to this new digital world, and that’s another replay of history. Back in the ‘60’s and ‘70’s, we used to call it time-sharing, and it allowed us to search enormous databases without taxing the capabilities of our small computers and dumb terminals. We relied instead on renting computing power from the water-cooled giants of IBM and other industrial firms. Ever wonder why some of the older business parks have big, glassy areas in the fronts of many buildings? They were put there when those buildings were constructed, to show off the resident firm’s computer. It typically filled the room and was a point of great corporate pride. The techs who worked in these glass-fronted rooms often wore white lab coats and gloves.

All that said, some things won’t change – at least not much. The Web will still function much as it does now, as time goes by perhaps more as a foundation for social sites than as an entity of its own. There will probably still be websites for some time to come, although some businesses already question the need for them, choosing to go straight to social sites instead.

The world will change a lot during the next five years, at a faster pace than it ever has before. How much more change will there be by 2020? The short answer: a great deal. We’ll report it to you as soon as it becomes clear to us. After all, at Borrell that’s our job.

The story reminded me of the effort during World War II to build bigger and bigger bombs. At the start of that war, 500-pound bombs were the standard. As conflict continued, 2-ton, 5-ton, and even 10-ton bombs were developed.  But as it turned out, the secret to ending the fighting did not reside in a heavier bomb, but in a single atom.

The YAM deal will undoubtedly yield some results – just as bigger bombs made bigger holes during World War II.  But it doesn’t hold much long-term promise, in my opinion.  The big Madison Avenue agencies persist in trying to reshape the Web into another mass media choice. They talk about scalable reach and CPMs – vestiges of the days when reach was measured by audiences, large groups, markets and households.  The world of concentrated media is changing to one of fragmented, personal media.  If Moammar Gadhafi were still alive, you could ask him.

The Web doesn’t easily fit any of these parameters.  It is, and always has been, a personal medium, more like a letter than a magazine. As users move their online reception from static computers to portable tablets and smart phones, the personal nature of the Web becomes more prominent while the mass communications side of it continues to wither.

Thirty years ago, when PCs were first gaining a foothold among consumers, a debate raged over whether people who couldn’t program computer code would ever use them. That debate has long since been settled. The debate now is whether people who don’t use spreadsheets and word processors – the bulwark of the static desktop – will use computers. I submit that the immediate and growing demand for tablets has settled that argument as well.

Most of what we use computers for can easily be done with smart phone or iPad apps, which are also more fun to use. They’re cheap, they have no learning curve to speak of, and when we are done with them they can be erased without qualm. Sure, there are work-related apps we can download as well, including some that can link us to desktops for “serious” computing. Some of us will continue to want and need these. Most of us will not.

The chart shows where local online ad spending is most likely to migrate as these trends persist and grow.  It’s not that advertisers will stop sending ads to stationary computers. It’s just that most ads will be received by mobile devices.

Advertising to mobile device users follows different rules than the ones set up for the mass media we have all learned to use. In fact, it won’t be advertising any more – at least not entirely. It will be a mixture of advertising and promotions that appeals to individuals, not mass audiences.

Some marketing innovators will learn the new rules and thrive in this new media world. Some, like the Madison Avenue agencies of today, will try to bend the world back to a mass audience model.  The chart offers a clue as to how well this might work.

The newspaper is The Virginian-Pilot, a 170,000-circulation daily where I spent a dozen formative years as a reporter and editor.  When I was a copy editor, a colleague once told me how to write a great headline.  “Imagine a kid selling newspapers on the street, yelling out the headline.”  That bit of advice helped me win a dozen headline-writing awards.

But on this past Sunday it wasn’t the headline that grabbed me.  The front page (which looks like it was designed by committee) had two headlines:  “Ghouls Rule!” and “Our New National Park.”  Those are about as likely to get me buy the paper as the sign on the potato rack that says, “Russet potatoes.”

The headline that captured me was bigger and more colorful than anything on the front page.  It also held greater creativity and news value than anyone on the copy desk apparently had the energy to think of the night before.  The headline:  “$240 in Coupons This $unday!”

It was both sad and heartening.  Heartening because at least someone was thinking about how to sell newspapers.   Sad because it wasn’t the people responsible for making the product compelling to the community every single day.

Like many newspapers, the once-formidable brand of The Virginian-Pilot is no longer strong enough to sell newspapers on its own.  That power was lost many years ago with the proliferation of local news and information both on TV and the Internet, as well as many years of newsroom downsizing.  At this particular paper, Page 1 reflects the diminished brand of a longstanding, two-time Pulitzer-winning product:  The front-page flag is small, pushed off to the left and crowded out by things above, below and to the right of it.

The same is not true of all newspapers. Many have held fast to what they do best in print. I was in Little Rock a few weeks ago and found The Arkansas Democrat Gazette chock full of news. (This Sunday’s top headlines: “Arkansas 31, Vanderbilt 28” and “Kabul bus bombing kills 12 Americans.”)  I read the entire paper on the flight home and got a robust slice of life about what’s important to the people of Little Rock.  A few months ago I visited Colorado and found much the same with The Durango Herald, a small newspaper that remains the voice of the community.

I guess I should be glad that marketing departments can take charge and find at least something of value to help sell the paper.  After all, the same percentage of people read the advertisements in Sunday’s paper as read the news.  The Internet can’t touch the newspaper when it comes to delivering the most comprehensive package of what’s for sale in a local community on that particular day.  Try to Google that.

Things are changing, however.  Three industry efforts are pushing out newspaper circulars and other local advertising that might just usurp the daily newspaper’s stronghold on that more valuable breaking news of the day:  Where all the big sales are.  Those efforts include Gannett Co.’s ShopLocal.com, Suburban Newspapers of America’s Zip2Save.com, McClatchy Corp.’s FindnSave.com, and The Associated Press’s iCircular.com.   I’m not certain these efforts will ever replace the daily newspaper as the No. 1 source for current sales information for local markets, but they certainly hold the promise of doing so.

In this tough economy, I suppose that shelling out $1.50 on the prospect of saving $240 is as good a way to sell a newspaper as any.   At the rate things are going at some newspapers, they’d do better to fold the paper so the advertisements could become the front page.

“Fact: Your sales force with those direct relationships with local business should be your #1 source of market research. Reps should always be doing CNA’s (client needs analysis) to uncover clues to help point your Newspaper web sales model in the right direction. If anybody should have high levels of market intelligence and know the spending habits of local business, it should be your local feet on the street …. NOT an expensive research firm. Duh.” (Moneyball: Fixing Newspaper Web Sales, posted Sept. 30, 2011, by Mel Taylor Media)

I suppose we could write this off as a sales trainer trying to sell training and a market researcher (yours truly) defending the power of research.  But since I deal in facts, I reel when I see one mislabeled as such.  I am reminded of Homer Simpson, the puzzled cartoon naïf who makes us laugh by connecting the dots exactly the wrong way. His typical response, when things go awry, is “D’oh!,” first cousin to “Duh.”

When it comes to market intelligence, connecting the dots accurately is vitally important. Brilliant sales strategists know that a single customer’s observations are anecdotal and that formulating strategies around them is as dangerous as gauging an iceberg’s size by its visible part. If two customers say the same thing, the importance of the observation begins to build. (Throw in a Duh at this point and you can stop the research right there.)  So, how many customers does a sales person have to interview before an observation becomes reportable? The answer is a lot – and that’s presupposing that advertisers tell their reps the unvarnished truth in every instance. “Will you spend more on radio next year?” coming from the mouth of a radio rep will likely get a different response than when a newspaper rep asks the same question.

The truth is, “feet on the street” have a mediocre record when it comes to market intelligence. The proof is the accuracy of the sales forecasts they provide, when pressured by their managers to do so. These forecasts are usually very similar to current year results, or maybe just a little better. Reps live in a year-over-year world. If this year is an improvement over last, they are rewarded. If it’s worse, the opposite occurs. That’s hardly the best atmosphere for keen observation and critical thinking.

Great salespeople are as horrible at research as great research people are at sales.

On the other hand, reps are very good at proving whether or not market intelligence is valid. If they try it and it works, they’ll use it again and again – and they’ll come to depend on it as an important part of their toolkit. If it doesn’t work, they’ll drop it like a hot rock and let management know in a hurry that it failed.

Expecting your reps to tell you about market trends is like expecting young children to tell you whether the carpet’s clean. After all, they’re closer to it than anybody else in the house. Without good market share and competitive intelligence, those “feet on the street” won’t find the best places to walk. Good market intelligence and good ad share measurement are like advertising. Poor business managers see it as expensive.  Good ones view it as an investment. Valid market research saves media companies from a lot of bad assumptions and wasted time.  It also helps them figure out what’s really happening in their specific markets.

“Duh” shouldn’t be in any sales organizations’ vernacular.  But “Aha” should.

It was easy to be overwhelmed with ideas and opportunities. So Borrell Associates President Colby Atwood and I sat down at the end of the 2½-day meeting and summarized the most important observations in a session entitled “Five Things to Do Next.”

1. Because the opportunities today seem to be yielding relatively small dollars, know the size of the market you’re chasing.  It’s easy to put way too much effort into a market segment that might deliver far less revenue than the expenses required to cover it. Our research shows that the total local mobile advertising expenditure for 2011 will be in the neighborhood of $788 million, and the majority of local markets are seeing less than a half-million dollars each. That will grow 103% next year, but it’s always best to get realistic first about the underlying dollars that support your mobile efforts.  Note:  to see my opening statement with our 2012 local advertising forecast, which includes this data, click here.
2. Take a very close look at mobile marketing’s geofencing capabilities.  We believe that this may hold the biggest promise for local media companies.  The presentation by Placecast CEO Alistair Goodman highlighted case studies showing businesses that sent text messages to people within the vicinity of their store, getting 73% of them to actually come in and 65% of them to purchase something.  Even more interesting was the fact that 49% of those who responded to the opt-in text by coming into the store hadn’t planned on coming in.  That’s extremely powerful, and hints of an entirely new method of “push” marketing based on consumers’ proximity to a store location.
3. Participate in mobile ad networks like those offered by AT&T Interactive, xAd, Where.com, Verve and others.  With mobile inventory growing exponentially, local sales forces may not be able to keep pace.  So it makes perfect sense to link into the mobile networks, which are reporting significantly higher CPMs than traditional online ad networks.
4. Invest in training, especially with sales forces.  Our surveys indicate that 48% of smaller local advertisers surveyed intend on participating in mobile marketing this year.  That’s very high.  Sales reps should be tuned into this interest and adequately trained to answer their questions.  In addition, the consultative sales approach — or “agency approach” — to selling is going to be vital.  We heard four local advertisers tell us during the conference that the “best” sales rep they ever encountered was trustworthy, honest, and helpful.  Not pushy, persistent and persuasive.
5. Don’t forget that mobile devices are rapidly becoming video-centric.  We heard stories about pre-roll inventory on TV websites being sold out, and being sold at CPMs north of $70. With the rapid transition of video viewing over to mobile devices, there is likely to be a great deal of opportunity for 10-second pre-roll and post-roll on video programming.   The CPMs alone should be enough to commit a fair amount of resources to building out video programming.

It’s an interesting theory, but it doesn’t hold water. In fact, it resembles one of the recurring nuances of disruptive innovation:  When faced with a disruptive innovation in their marketplace, the leaders of incumbent industries grossly underestimate the size of the disruption.  Call it denial.  Call it the Goliath Syndrome. It happened to the vacuum tube industry when disrupted by transistors in the 1960s.  It happened to IBM when mainframe computers were disrupted by minicomputers.  And it happened to Kodak when silver halide film was disrupted by digital photography.  (Oddly enough, it happened to a lot of ad agencies who denied the viability of the World Wide Web throughout much of the last decade, paving the way for digital-focused agencies like Tribal Fusion, Razorfish and Burst Media to steal clients.)

The Ad Age blog suggests that until the Madison Avenue agencies wrap their heads around mobile, nothing much will happen. The fact is, a great deal is happening right now, but the big agencies are not observant enough to catch or notice the trend. Smaller businesses – the fabled SMBs – are leading the charge to mobile because it can fill their stores and cafes. Bigger businesses, the ones smart enough to see what’s happening, are turning the reins for mobile campaigns over to their local branches and franchisees.  Bigger things happen at the local level.

The 20^th century notion of big, one-size-fits-all marketing campaigns is wilting against a tailored, locally-centric approach.  Campaigns depend more on local opportunities than on global/national planning. Advertisers that are accustomed to making their marketing decisions in the board room will have to depend more on their local management.  Some takeaways from the new world of 21^st century marketing:

• The old notion of promotions vs. advertising is dying quickly. Smaller businesses don’t recognize those boundaries. To them, anything they spend money on to bring customers in is in the same bucket, and they want definite proof that it worked before they’ll try it again.
• Customers are busier than ever. Their mobile phones have become vital communications and transactional lifelines. They don’t want to wait until a specific time to watch their favorite shows. They want to download them and watch them when it’s convenient. They don’t want to accept a retailer’s price; they want to use mobile devices in the store to compare prices at other retailers.  They simply don’t have time to drive around from store to store anymore.
• Coupons and deals are the watchword, and they are moving online and to mobile. Even though coupon redemptions are hitting record rates, the number of printed coupon “drops” in a market continues to fall. Their digital replacements are easier to find, store, and use.
• Deals and other payout-guaranteed promotions may be the long-term face of local marketing.  The idea of getting a check for your marketing efforts that grows as they become more successful is very compelling.

Of course, the buyers from big agencies (and their bosses, as well) will strongly dispute each of these points.  They will talk about strategic initiatives, share of voice, imprint accumulation, and all the other terms that have stood the test of time. It won’t matter. These terms are anchors to the past. They grew and flourished in a world where people had fewer choices and advertisers fewer options.

Today’s marketers need wings, not anchors. By the time the old guard acknowledges the scope and breadth of what’s happening every day in online marketing, no one will be listening.

What qualified these operations as top performers wasn’t what you typically hear from speakers at conferences: cool projects that drove spikes in web traffic or innovative ways of using Twitter. They got right to the nuts and bolts: The money. The “Innovation Mission” executives studied the underlying strategies for sales and content that drive these companies to vastly outpace the industry in revenue growth.

The coast-to-coast tour had them visiting a mix of TV, newspaper and pure-play Internet companies in the U.S. and Canada. The most common characteristics they found:

• An obsession with training on both the sales and content sides
• Traditional-media reps successfully selling digital products (with some exceptions)
• Digital-only salespeople delivering the most revenue growth
• Compensation & bonus plans that are critical to achieving goals
• Vast networks of community content contributors

Before I go on, I wanted to clarify statements I’ve been expressing for the past decade about what types of operations drive the most revenues. I have an unfair advantage in this observation because Borrell Associates maintains a revenue/expense database of more than 4,800 local online operations in the U.S. and Canada. I can literally see the top performers – those making as much as 10 times more than their peers. And I know what they’re doing differently.

The clarification involves my adamant belief that online-only reps are a necessity for local media companies that want to be top performers. Somewhere in that admonition people have heard, “Traditional media reps can’t sell online advertising.” Not true. Traditional reps should be employed to sell digital products to the greatest extent possible. That’s Job 1 for any radio, TV, yellow pages or newspaper company with a valuable on-the-street sales force. But if a company relies exclusively on these reps, they’ll wind up being exactly average in terms of revenue performance. And who wants to be average? Remember – I’m looking at those with exponentially more revenues. And those companies – like the ones on the tour – are adding digital-only reps at a rapid clip.

At one of the stops on the tour, the manager said 70% of digital sales came from traditional (TV) reps in 2009, and that he anticipated it would be down to 45% this year. The greatest growth, obviously, is coming from the digital-only staff. And you can bet those reps are building a new customer base while the TV reps are relying heavily on existing customers.

Among the stops were hyperlocal pure-play company Examiner.com in San Francisco; KSL-TV and Deseret News in Salt Lake City; Dow Jones Local Media Group; Journal Register Co.; and Metroland Media in Toronto. It was sponsored by Suburban Newspapers of America, one of the few trade associations in the country that looks outside its membership when trying to provide expertise about what’s going on with the Internet.

I highly recommend this webinar. The association has made it available for non-members at a cost of $79. You can access it by clicking here.

The people who ran legacy media — newspapers, radio, TV, direct mail, and directories — all had two things in common:

1. They looked at growth as a year-over-year phenomenon.
2. They weren’t very interested in share.

As a result, as long as the national economy hummed along, business was great. Sales increased just about every year. Year-over-year, increases looked fat. It wasn’t until the economy tightened that loss of share became obvious. By then, corrective measures didn’t matter. Gone was (and is), well, gone.  It’s hard to see any return path for directory advertising or classified advertising, or even all those local automotive and homes magazines.

Some of the reason behind these losses starts with the way sales budgets were developed. Take newspapers, for example. The big metro dailies started budgeting for the coming year around July. The famous “7 and 5″ — seven months of actual ad sales results projected to year-end using last year’s percentages — started the ball rolling. Next, the ad director polled the sales force for their best guess at how next year would turn out. Sales people are typically conservative to the extreme when making such prognostications. Their results typically show growth … but not too much growth. Why stick your neck out for no purpose, after all?

The ad director compiled the sales force estimates and sent them to the publisher as his or her best effort, perhaps after jawboning some additional increases from the troops. The publisher then sent them to corporate, along with the best guesses from the rest of the organization on what spending was to be, as the newspaper’s best guess at next year’s result. By this time, September would have come and gone.

Corporate’s answer was quick and predictable. Spending was too high and sales were too low. The “number,” the margin that had to be met, was presented to the publisher, who dutifully passed it along to the staff. Everybody moaned and gnashed their teeth. Then they set to work to meet the new target:

• The ad director pushed the ad sales force to provide “more accurate” numbers. At this point, some creative effort often emerged. First and second quarter forecasts remained much as they had been before, but third and fourth quarter projections grew to new, higher levels. “We always hoped for a new store in town and a great Christmas,” one senior ad sales veteran explained to me.
• Everybody tried to find ways to cut expenses. Programs and purchases were curtailed. Where possible, staffs were diminished. Newspaper managers became expert at managing their “FTEs” (full time equivalent employee counts) creatively.

By now, the leaves on the trees had long since dropped, and often “the number” could still not be met. Only one solution was left: an ad price increase. But where to increase? Obviously, increases were put on the most popular products. During the 1990s, that meant classified. Classified rates soared during the last decade of the 20th century, and rate cards became almost unintelligible. As one corporate VP explained, “If they can understand the rate card, then it’s not a good rate card.”

Sometime late in the year, or early in the next, a letter explaining the ad price increase and the reasons for it (“… the rising price of paper,” for example) was sent to each advertiser. Immediately afterward, the ad sales reps, with the aid of the ad director and the publisher, visited each of the paper’s biggest advertisers. Their goal: to mitigate the increase so that these large advertisers would not feel its full effect.

As a result, three things happened:

1. Smaller advertisers (not visited) were alienated.
2. The profit margins for ads from larger advertisers diminished.
3. Barring some influx of new business, the ad sales budget could not be met.

What’s important here is that the whole process was done without looking outside the building. Share was never a consideration, nor were the laws of Economics 101. So, while it’s certainly true that the new media gorged itself on what had been sinecures for newspaper advertising, they were aided and abetted by the shortsighted, inward looking management practices of their legacy media victims.

The moral to the story: look outside when you plan. Estimate share and take the activities of your competitors into consideration. Don’t assume next year will behave like last year …  except maybe a little better. Learn from the mistakes of others, or be prepared for similar consequences.

If I were one to mix metaphors, I’d say they’re goring the cow that feeds them while simultaneously tilting at windmills.  If I were to speak in disruptive technology lingo, I’d say they were engaging in a lot of cramming.

First off, newsrooms shouldn’t be dictating what local TV stations and newspapers do on the Internet.  The obsession with shoving news content and commentary onto the web – with advertising as an assumed result – has caused them to miss richer opportunities.

Terry Heaton, senior vice president of Media 2.0 for media consultancy AR&D, has been a big proponent of getting TV stations to deliver “continuous news” via the web.  So you’d think he’d be a big proponent of news organizations thinking about the web before anything else.  Not so.

“To me, ‘digital first’ can’t work, because digital and legacy are two entirely different services,” Heaton responded when I sent him an advance copy of this blog.  “Trying to put digital first when your operating process is ‘finished product’ is not only silly; it’s suicide.”

Heaton says that his Continuous News innovation “is born of the Web for the Web, which is unlike what everybody else is doing. Even with that, though, we have GREAT difficulty gaining acceptance, because their instinct is to bolt digital onto the old.”

What’s happening, I believe, is that the local news industry is unwittingly engaging in the cramming phenomenon. They’re taking the old product and trying to adapt it to the new technology in what appears to be radical strokes, instead of letting the old model run its course and crafting a completely new one.  It’s the same “digital first” mentality that had Britannica.com 15 years ago appearing to be radical by electing to sell low-priced CDs and online access over higher-priced encyclopedia books – thereby entirely missing cake-eating opportunities like Wikipedia and Google.

Forcing local news down into the digital space hastens the erosion of their core products unnecessarily.  The industry is defining news much the same narrow way Britannica defined research.

Local news isn’t the brass ring on the Web.  There are two problems with it:  First, it’s not as big of a draw that everyone thinks, and second, the value of its audience is relatively low.

News indeed attracts millions of adults every day, but that’s mainly national news.  Local news only appears to be a big draw until you extract weather and traffic.   If you factor those out, you’ll see just how small and eclectic the audience is for the traditional definition of “local news.”

To understand this issue, consider the posture of media consumers.  With TV, radio, newspapers and magazines, they lean back.  They’re receptive to the serendipitous nature of those media.   With the Internet, they’re leaning forward.  They’re focused seekers, not relaxed readers.  They seek, find, leave.  The only other medium like that is the yellow pages.  The problem is, local news just isn’t that compelling (unless of course there is BIG local news, which is rare.)

Why is posture important?   Seventy-nine percent of online news users say they’ve never or rarely clicked on a banner ad, according to Pew Research.  In addition, research from Web design expert Jakob Nielsen shows that people looking at information sites rarely even see banner ads.  They are leaning forward and hunting, eyes focused on what they’re reading, and not focused on anything else.

I don’t see the economic model for local news online.  It’s labor intensive, and advertisers aren’t looking to buy nebulous traffic.  But it’s not my opinion that matters.  It’s the opinion of those who finance all those journalists:  advertisers.   And their votes are clear.  The digital content that they’d rather be around is content that delivers wallet-ready consumers, not occasional news browsers.   Half of the Top 20 sites in terms of local online ad revenue are advertising-only sites.   The Top 5 have nothing but advertising content.   (See our latest report, “Benchmarking Local Online Media: 2010 Survey,” March 2011.)  Looking at the data of 4,800 sites in that survey, I saw one startling example where a news-oriented TV website with 400,000 monthly uniques was making the equivalent of $10 per unique visitor, while another site in the same market with fewer than 20,000 monthly uniques – a niche site with advertising-only content — was making $150.

So here’s my take on what happened in that market:  The TV site chose to expend its resources cramming the news model onto the web, thereby missing the niche opportunity altogether.  Why would they bother with a site that generated less than one-tenth the traffic and had no intrinsic “news” value?

Those who have adopted the digital first news mantra, I fear, are doing exactly what Clay Christensen described in his “Innovator’s Dilemma” was one of the principal ways that smart managers fail.  They adopt the new technology within the framework of the existing business model, making what appear to be radical changes that are actually just modifications to the existing business model.

I’m all for great journalism.  My wife and I have been writers and editors for various metro newspapers, and I’m not ashamed to say that we were both moved to tears when we visited the Newseum in Washington last summer.  Radio, TV and newspaper journalism has done great things for the world.

But journalism, like Britannica’s encyclopedia business, is a controlled product.  The Internet’s role in doing great things revolves around uncontrolled communications.

As for the whole digital first journalism thing, I do believe that the local news franchise will gradually move to tablets and that newsrooms should be experimenting with ways to migrate to that end game.  In a few decades you will probably be able to Google “the death of local news on TV and in newspapers” and read how it all just eventually collapsed.

But I guarantee you that nobody’s going to Britannica it.