Related post: At Almost 400,000 Digital Subscribers, Inside the New York Times Pay Strategy, Year 2

2. Didn’t CNN’s coverage of the Iowa Caucuses illustrate our screens future? John King has been the King of the Screens, and we can remember when his magic-touch screen seemed wildly innovative. Now in the touch-screen era, it was all screens all night — save Wolf Blitzer’s classic utterance of “OMG” in seeing Romney go up by a single vote — and CNN newbie Erin Burnett brought the right slapstick spirit to the uncertain screencraft. She whooshed one image off one screen on to the next one, sometimes successfully. CNN’s use of data, even as limited as it was for this election, showed how much we’ve moved beyond the world of still print infographics. The marriage of analytics and screens from tablets to livingroom monitors is forever changing how we take in information.

3. If AOL crumbles in one direction or another, what’s the future for smart cookie Arianna Huffington, who has parlayed personality and business model into an enviable perch in American journalism? Who might pick up HuffPo, one of the easiest-to-define business lines in journalism? How much will its relatively low rate of ad return (“The Newsonomics of ARPU” deter buyers? With the emergence of a broad international strategy (10 new editions) – “We’re now re-expanding back into a list of countries”, said CEO Tim Armstrong Tuesday – it becomes a more interesting play.

4. With Alibaba hot on the Yahoo tail, how much should we wonder about the future of big aggregators stocking up on a professional journalists? AJR estimated that Yahoo has hired about 200 journalists and AOL 250 (not counting the Patchers). Those hundreds have produced some pretty good journalism, particularly with sports scoops, and have proven that the term “as first reported by Yahoo,” isn’t a joke. The question of Chinese ownership is a knotty one (interesting Fortune take on American hypocrisy, here), but we have to ask questions about how free a journalistic corps would be under Jack Ma leadership. It might be well and good to uncover U.S. football corruption, and that’s a growth sport itself, but what about wider public policy coverage? For AOL journalists, the questions are even gauzier. With AOL’s deepening financial questions and investor pressure to cut back on non-profit-producing business lines, how long will there jobs be maintained, under current or potential new management/ownership?

5. Won’t be 2012 be the age of All-Access perfecting? Time Inc is among those getting its tablet act together well, with Time Magazine a fairly slick tablet app. In December, the company made a foray at convincing print subscribers that connecting the print sub with digital access is a good idea. The sign-on process is fairly straightforward, and seems to hold session to session, unlike some others. Yet, subscribing to more than one Time Inc. product — Time Magazine and Sunset, for instance — has to be done twice. Expect that kind of obstacle to be eliminated going forward. All-Access will be real all access, made easier for consumers. And All-Access is even trickling down very local as the Monterey (Ca.) County Weekly heralds its all-access availability through public radio sponsorship. Getting All-Access right — pricing, real tablet- and smartphone-appropriate apps, customer ease, giving subscribers cross-title benefits — is one of the biggest tasks for news and magazine publishers this year.

6. How could a single person be empowered to send a message on behalf of the New York Times to eight million people? The Times’ your subscription-is-ending embarrassment email showed the company at its worst in detecting and handling a crisis. My larger question is how, in any scenario, a single person has the unchecked power to send a message to eight million people on behalf of a big brand? The culture of checking and doublechecking (yes, the sorry Judith Miller tragedy aside) is so deeply ingrained in Times’ DNA. Why isn’t it part of the wider culture, especially in the one-click age?

7. What’s more local than language? The Times profiled Wordnik Sunday. It’s an innovative modern language company making the most of digital technology to surface new and real meaning of our living language in this fast-changing age. Noted in the story is that the Times and News Corp’s Smart Money are using Wordnik for glossaries? As local media look for ways to really be more local, knowing and presenting more about place is essential. So what about using something like Wordnik to create local language guides? It’s a small idea, perhaps, but one showing how even local media need to make more use of digital tools if they are to make future claims of relevance to local audiences.

8.Hasn’t Gail Collins turned out to be a just-right-for-the-times replacement for Frank Rich? Rich’s rich prose and panoramic view often left us breathless in its sweep, and well deserved a Pulitzer. Yet Collins — a New Yorker who recently pointed out that “John McCain came in fourth in 2008, with the support of 15,500 Iowans. This is approximately the number of people who live on my block” – has brought a Hee-Haw sensibility perfectly suited to the Wonderlandia of the Republican primary scene.

9. With a call-out to Ken Kesey, isn’t 2012 the year when you’re either on the cloud … of off it?

Okay, it’s 11 p.m., and you are in bed.

What do you reach for? There’s no wrong answer here, but if you are in the news/information mode, you may reach for your Android smartphone or scoop up your iPad. So many choices, at this oddly news-consuming time of day. We know that evening is when tablet usage peaks, and, yes, such companies as Zite tell me that 11 is a top hour. An Ericsson study shows that usage is heaviest in the early and late evenings, when over 60 percent of users are active, with 40 percent using their smartphones before going to bed.

As Ipsos OTX President Bruce Friend recently put it: iPhones and Androids are, yes, our lovers. “It’s almost always turned on. It never leaves you. You have an intimate relationship with it.” Yet love is so short-term these days: “The tablet is rapidly becoming a companion or even a competitor to the smartphone. Tablets reduce smartphone as entertainment devices. The tablet will take the place of that.”

We’ve got so many emerging studies of our fast-changing habits that comparing them can leave you dazed and confused. What they all add up to, though, is a simple learning: Digital disruption is now increasing. Audiences are even more up for grabs than they were a couple of years ago. Advertising and sponsorship dollars, pounds and euros, are also being more greatly swayed by these disruptive winds than they were in 2009.

Let’s look at some of this emerging data, and begin to make sense of what it means and where revenue is likely to flow into the next several years, in the Newsonomics of disruption.

Consider local news disruption. In a report this week pointedly and smartly entitled “How People Learn About Their Local Community,” Pew Research Center’s Project for Excellence in Journalism and its Internet & American Life Project gave us a picture of reader disruption, if not downright confusion.

Among Pew’s conclusions:

Most Americans (69%) say that if their local newspaper no longer existed, it would not have a major impact on their ability to keep up with information and news about their community. Yet the data show that newspapers play a much bigger role in people’s lives than many may realize. Newspapers (both the print and online versions, though primarily print) rank first or tie for first as the source people rely on most for 11 of the 16 different kinds of local information asked about—more topics than any other media source.

The worth-a-read-report analysis points out that Americans aged 40+ are those most interested in civic issues (many of those 11 info types above). Non-newspaper sites, though, snare more of the younger people, and therein lies the further local disruption to come:

Web-only outlets are now primary source of information on key subjects like education, local business and restaurants. And greater disruption seems to lie ahead. For the 79% of Americans who are online, in addition to Americans ages 18-39, the Internet ranks as a top source of information for most of the local subjects studied in the survey.

Yes, in the digital din, we don’t know what we’re getting from what — or its relative importance.

Consider tablet disruption of smartphones. Remember, in late 2009, when tablet naysayers said, “It’s just a big smartphone, and do you want to hold that big thing up to your ear?” Well, they were at least half-right. The tablet is, in part, a big smartphone — but, oh, what a difference several inches make. Inevitably, minutes eat into minutes, and we’re just learning which devices we prefer to use for which activities.

Consider emerging tablet news disruption. For 18 months, the tablet and smartphone news environment has been single-brand-oriented. Early top-drawer brand winners include: The New York Times, the Wall Street Journal, the Guardian, the Daily Mail, the Telegraph, the BBC, NPR, the Financial Times, and CNN.

Three start-up news aggregators have popped up their heads. Zite, a product that has pushed the concept of “fair use” taut, has been scooped up by CNN.Flipboard, with a revamped publisher relations strategy in place, and backed by$60 million in venture capital, would like to be the tablet news aggregator, as would Pulse.

We’ve wondered where the big guys are — those winners in the online web derby. We won’t have to wonder much longer. Google Propeller and Yahoo Livestand will soon join AOL Editions, as Facebook, Amazon, and Microsoft all up their various tablet aggregation plays, as well.

2011 may well be remembered as a short time of innocence in the tablet news landscape.

Consider tablet disruption of laptops. Several forecasters have said tablets will surpass laptop sales within a year.

Consider tablet disruption of tablet. Kindle Fire has unexpectedly sped through the “less than $200 tablet price point” barrier, one pointed to way back in 2010 by analysts as a key to the tablet becoming a mass product. So Kindle Fire, with its deepening bench of Amazonian media products, will update the American promise: Two tablets in every house, and a shiny new hybrid in every garage (as soon as the recession lifts). As if Apple, forecast to sell 100 million iPads worldwide by the end of next year, hadn’t already done the unthinkable.

So how will these developments affect the two hopes of the news industry: digital ad and digital circulation revenue?

Consider digital circulation plans. “Paid content” strategies were well underway before the iPad hit the market, but the iPad made them swerve. Now publishers are seeing longer-term print replacements more rapidly making the digital jump.

For newspaper execs, now increasingly placing all-access circulation strategies at the center of their 2012 budgets, the thrill and chill of tablets replacing print (“The Newsonomics of the Missing Link“) is only accelerating. Further, Amazon’s instant emergence as a #2 player in the field offers new partnership/store potentials for the news industry, even as it races to the agnostic technology of HTML5.

The faster the disruption of print by tablet happens, the faster newspaper owners can jettison print expenses and get closer to sustainable (but not yet proven) mainly-digital business models.

Consider how ad revenue trends are moving. Now, mobile audience patterns are way ahead of advertising revenue splits. That’s often the case: Audience precedes slower-moving (standards, technologies, due diligence) spending moves.

Many publishers privately report that mobile news access now accounts for 10 to 20 percent of overall digital usage.

Yet only 3 percent of digital advertising spend — about $1 billion in the U.S. and $264 million in Europe — will be spent on mobile this year. If usage matched spend, we might see a quadrupling of that mobile spend sooner than later.

So in the mobile ad spending disruption, where will the spending come from? Will it come from other digital — or print, or broadcast — and in what proportion?

Indeed, in this device-eat-device race, we have to wonder the extent to which tablets will supplant smartphones, which are now headed toward a 60-percent penetration of U.S. and European cell phone users by some time in 2012.

(I’ve noticed at the body inspection pit also known as airport security an increasing trend: business travelers placing MacBook Airs, iPhones, and iPads into the gray trays. That’s a $3,000 business play, but it may be a leading edge.)

Five digital native companies now control almost two-thirds of U.S. online ad spending, now drawing 63 percent of digital ad dollars. Within that trendline, though, we’re now seeing an increasing divergence of winners and losers. Yahoo and AOL continue to lose market share, while Google, Microsoft, and Facebook are all gaining. The disruption within those top five is eye-opening, looking at net ad revenue growth after companies have paid their partners for obtaining traffic, according to eMarketer:

For 2011, here’s the scorecard:

Facebook, to be up 80.9 percent

Microsoft, to be up 29 percent

Google, to be up 27.3 percent

Yahoo, to be down .4 percent (following declines of 5.2 percent in 2010 and 12.5 percent in 2009)

AOL, to be down 2.4 percent (following declines of 11.5 percent in 2010 and 12.4 percent in 2009)

Facebook’s disruptive impact will only be augmented by the multiple-front, market-invading forces of f8. Remember Microsoft’s decade-old bid to become the hub of our entertainment lives, as evidenced by its futuristic Consumer Electronics Show displays? Facebook has taken that metaphor, socialized it, and updated it for years to come.

2011 may well be remembered as a short time of innocence in the tablet news landscape.

Look at it this way: Facebook, with about $2 billion in digital ad revenues this year, will be two-thirds of the way to equaling the total digital ad revenue — about $3 billion — of the entire U.S. newspaper industry. (And the print newspaper total of maybe $20 billion this year is less than two-thirds of Google’s total revenue of maybe $34 billion in 2011.)

Digital advertising? It’s an infant. Check out PaidContent Staci Kramer’s interview with Neil Mohan, Google’s VP of product management. Mohan talks about the $200 billion digital display industry to come, almost 10 times what it is today. (Of course, Google potentially has lots to lose in a mobile disruption if that disruption continues to play havoc with its revenue engine, search.)

Finally, in disruptive revenue, let’s look at app revenue — which, of course, didn’t exist five years ago. According to Forrester Research, smartphones and tablets will reach $38 billion, globally, by 2015. (As a yardstick, $38 billion is about half of what we’d consider the worldwide newspaper industry to take in four years from now.)

This disruption to come seems Rubik’s Cubean. There’s the mobile disruption, and the mobile-on-mobile disruption, with twists of generational difference, tectonic ad spend changes, and lots of confused citizens. While it seems late in the game for some, it’s early for others. We may not yet be into a new “the first one now will later be last” era, but be careful placing your bets too early.

First published at Nieman Journalism Lab

Picture Pre-Tablet Man (or Woman). Let’s go back to the time before Palm Pilots, at the dawn of consumer digital civilization itself, a time of AOL, Prodigy, and Compuserve. Hunched heavily by the analog world on his shoulders, Pre-Tablet Man has slowly begun to raise his head, through successive innovations of laptops (!), pocket-sized cellphones, smartphones, smarter phones and early e-readers. Now, as we enter Year 2 of the iPad era, it seems like our digital man is almost standing up straight. The digital world has moved from geek chic to consumer commonplace. Our digital devices have become on/off appliances, no manual necessary.

In this evolution, the iPad is so far our human pinnacle, though it will be followed by wonders to come. It also marks a signal change in digital usage, and especially in digital news consumption. I think of it as the likely missing link in the digital news evolution. It’s a link that, out of the blue — or maybe out of the darkness — has offered news companies, old and new, the unlikely (last?) chance to get a new sustainable business model.

We’re now approaching the second half of this highly transitional year, with its multiplying paid circulation tests, continuing print revenue declines, and greater re-focusing on digital ad sales. As we do, let’s look at the newsonomics of the tablet as the missing link. Let’s do that in light of what I think are the six major realities confronting news companies at mid-year.

1. Reality: Print is in permanent decline.

That’s what 21 consecutive quarters of decline (year over year) in U.S. newspaper print ad revenue tells us (“The newsonomics of oblivion“). Consumer magazine revenue has moved barely positive, but is still substantially below pre-recession levels. Print is there to be milked, as long as it can, in the digital transition. Fewer newspapers are being sold, and they are thinner and thinner.

The tablet link: The tablet is a print-like replacement for newspapers and magazines. Publishers privately report (and an increasing spate of reports from Instapaper to RJI to Yudu) that tablet readers read the tablet much more like the newspaper than the way they read news websites. Longer session times. Longer stories. Early morning and evening reading. Pre-tablet, publishers had no potential replacement. Yes, smartphones have been a great check-in short-form reader, but that’s more of a traditional online-like behavior. Now they’ve been given a gift by the technology gods.

Caveat: The tablet is print-like, but it’s not print. It’s a new medium, first inviting — and soon demanding — that publishers make use of its interactive, video-forward, and smooth-as-silk social sharing capabilities. If publishers persist in “going slow,” sticking with cheaper-to-produce replica tablet products, they’ll squander the tablet replacement-for-print opportunity, as new market entrants from the AOLs (including flag-in-the-local-sand Patch) to the Bay Citizens surpass them.

2. Reality: Online engagement is inadequate.

The tablet link: The tablet offers a way to re-engage readers, a corollary to the tablet’s replacement potential. The biggest problem for news publishers isn’t (a) that the digital ad world only produces pennies on the old ad dollar, (b) the low share of digital ad revenue they get, or (c) a changing cabal of digital startups from Yahoo to Google to Apple that are stealing their business. Their biggest problem is online engagement.

News producers work in a world of massive cost, funding well-paid newsrooms and all the legacy supports from advertising to finance to circulation. That investment made a lot of sense when readers really engaged with their products. Consider that in the heyday, your average newspaper would command 270 minutes (4.5 hours) of attention per household per month. Consider that online, the average engagement time is five to 15 minutes per month.

So, if early tablet reading patterns persist, publishers could find themselves on the road to re-engagement. The possibility: short-form, headline-and-blurb desktop/laptop reading may have been the news industry’s nuclear winter, with a greener spring on the horizon.

Caveat: It’s still way early to know whether more engaged reading patterns will last. I believe they largely will, but that publishers will soon find themselves fighting for engaged minutes with whatever successful aggregators emerge from new crowds of Flipboard, Pulse, Zite, Trove, Ongo, and News.me, just to name a few. Ventures like Next Issue Media address may address destination buying, but not product aggregation in ways that consumers have shown they love. Aggregation won Round One of the web, as individual publishers lost. We may be seeing history repeating.

3. Reality: Google juice is wearing thin.

The tablet link: The tablet is driven more by direct traffic, by apps, and by direct browsing than by search; early publishers results show a healthy majority of tablet news visitors coming direct, unlike the online experience. Search isn’t over, but it’s being pushed aside as the beginning and the center of our online news activity. Publishers never found Google juice all that nourishing; it provided lots of calories, but too little muscle tone in new direct revenue created.

Caveat: Again, this is early behavior. While Google juice may stay thin, Facebook and Twitter juice are getting tastier, and will, in part, replace Google as important referrer of potential new customer traffic.

4. Reality: The only big growth is digital.

The tablet link: The tablet may be the path to getting print-like ad revenues.

News publishers have one story to tell, and that’s what we hear in quarterly reports and increasingly infrequent interviews: the growth in digital ad sales. The New York Times touts that 24 percent of its ad revenue is now digital, with McClatchy and Gannett just below 20 percent. Journal Register CEO John Paton talks about the digtital EBITDA his company will be able to throw off by 2014. At the same time, digital ad growth isn’t coming close to making up for print ad decline at most companies.

With current high ad rates, approaching print ones, high national advertiser and ad agency focus, tablets may be a great ad platform, unlike online or smartphone.

Caveat: Newspapers current earn more than $500 a year in Sunday revenue from print subscribers. Can tablets, if they replace print, ever come near that number?

5. Reality: Digital circulation revenue essential is essential to a new sustainable business model.

The tablet link: Consumers appear willing to pay for some kinds of tablet content. Imagine the paid proposition today without the tablet. Selling online/print? That’s a tough proposition. Print/smartphone? Well, maybe. The tablet gives publishers a much better value proposition to offer readers. All Access — including tablets — may prove to be a winning proposition.

Caveat: Early paid experiments aren’t producing much digital circulation. Why? In part, the tablet-wow products are in their infancy, and engagement remains too low. If too few readers bump into the pay wall, even fewer will pay up.

6. Reality: The News Anywhere Era is becoming real.

The tablet link: The tablet is a part of this new News Anywhere expectation. Getting news wherever we are has moved from something cool to something expected overnight. News Anywhere has offered a new playing field and a new value propostion that publishers can offer readers. In the era in which Netflix, HBO, and Comcast offer Entertainment Anywhere, news publishers have been presented a model — an All Access model — that readers can easily grasp.

Caveat: Readers grasp the model — and have high expectations. That means news publishers must more quickly satisfy those News Anywhere habits, properly formatting for each device and understanding how consumers are using news differently on their iPhones, their iPads and on their desktops. Most are simply not yet prepared to take advantage of this revolution.

A logical position: We’re the new free, anti-Murdoch alternative! At at a time when News Corp, the New York Times and dozens of others U.S. newspapers are “going paid,” about to erect porous (metered) and solid pay walls, taking a free position can be clear to mass audiences confused by what wall they may run into here or there. Imagine the new AOL/HuffPo ad soon after the New York Times goes metered — best in the Times itself:

Come Visit Us

Anywhere

Anytime

FOR FREE

That kind of position may fit well with Tim Armstrong’s mantras and manifestoes. If the former head of Google advertising really believes he can more efficiently monetize digital content than his various competitors, then he bets the company on it. Forget the two legs of revenue — advertising and circulation — that the old guys want, we’ll just focus on the fastest growing kind of advertising in the country and the world, digital, and do it better than anyone else. He’s got a major issue with that, of course, pointed out by many observers. The new independent AOL is not (yet) climbing the digital ad mountain quickly enough. In fact, its last report showed continuing year-over-year declines.

Execution must match up with strategy, and now given the HuffPo purchase for $315 million, sooner than later. One key question there: where exactly is AOL’s mobile push? Its apps are anemic, still focused on instant messaging, and so far lacking for Patch, this as the location-aware mobile marketing revolution takes flight.

Advertising execution may be key, and today Tim Armstrong put a new face on his brand. In fact, given the announcement that Arianna will head editorial operations overall, we’re unclear how much the going-forward brand is in fact AOL or HuffPo, or some nested version of the two, a nesting that would probably only confuse the marketplace and readers more.

Make no mistake. Armstrong needed to put a face on the brand, for AOL, overall, has been faceless. Sure, Armstrong is well-known among media people, but not more widely. AOL, like Yahoo, suffers from portalitis,a big grab-bag of topics and sites that don’t have a common consumer promise. (It’s no accident that both showed revenue drops, as digital advertising is going gangbusters again in the recovery.) With Egypt exploding over the last couple of weeks, it was CNN, Al Jazeera, the Times, the BBC and the Guardian that people turned to. No one said, I’ve got to see what AOL has out of Cairo.

Ah, but what kind of new face will AOL/HuffPost’s be?

It could be, simply, the anti-Murdoch. Sure, The Daily is “centrist,” whatever that means in the world of 2011, but the right-leaning proclivities of Murdoch Media are clear. MSNBC has tiptoed into the “anti” position, leaning forward gingerly, but then wrapping itself in knots over small campaign contributions. Arianna could simply embrace the left end of that spectrum, porting over her passion and partisanship, the very elements that have defined her Post, the fastest growing news site on the web (“The Newsonomics of HuffPo’s Pinball Wizardry“. In fact, if she doesn’t bring along what got her to where she is, then what exactly is AOL buying and where will her core audience go?

Would Tim go for it? Yes, if it makes money, as we saw clearly in the leaked AOL Master Plan. For Armstrong, it’s simply about the efficiency of the markets, bringing state-of-the-art digital manufacturing techniques to the old standbys of editorial and advertising. He needs lots of content — some from highly paid names and lots more from good-enough user gen — and must get his machine (better SEO, more pageviews per story, lots more lucrative video) tuned before he runs out of money. Just one suggestion for a short-term moneymakers: pay-per-view web video of Arianna’s first meetings with Techcrunch’s Michael Arrington and Engagdet’s Joshua Topulsky. Bonus WWE prices if she talks to them together.

Ready to trade up? That’s the new question now moving to the forefront of news publishers’ longer-range strategic planning, as the real tablet revolution seems to be upon us. The Consumer Electronics Show is shining a bright light on The Year of the Tablet. With tablet sales projected to reach 70 million in the U.S. in 2011 and 2012 (50 million of them iPads), and with early survey results, such as the Reynolds Journalism Institute’s study, showing longer news session times, more-than-snippets-reading, and a renewal of lean-back, pleasurable longer-form reading, publishers have been edging into an age of news reading renewal.

Maybe, people do want to read news and watch news after all, and maybe branded news can find its mojo once again. Then, as soon as the euphoria of they-really-like-us-after-all subsides, the next questions uncomfortably follow. The big one: Where will the minutes spent reading news on the tablet come from — with early evidence suggesting they will come both from print and from desktops, laptops, and smartphones. One certainty: They have to come from someplace; multitasking isn’t endless.

So, publishers are just beginning to ask themselves, what if news consumers like these tablets so much and so quickly (maybe even taking them to bed, forsaking the soon-to-be-jilted smartphone) that print readers flee from musty, old newsprint even more quickly than they have over the last difficult decade? What if newspaper readers, clearly pivotal early adopters of the iPad, decide they really don’t need the paper anymore — that they’ve got the paper, in almost-paper-like form right in front of them, more environmentally friendly and updating throughout the day?

That’s when the euphoria can turn to sudden dread. It’s great that readers want — and may pay for — news on the tablet, but if they flee print more quickly, how will that play havoc with the business model of news and magazine publishing? Today, entering 2011, no U.S. news company makes more than 16 percent of its total revenues from digital; all depend on print for 84 percent or more of their journalist-paying income. They’ve been transitioning, and transitioning, and transitioning — yet they’re only one-fifth of their way into it by the metric that matters most.

A few companies are now laying new strategy, based on private projections. They are forecasting that 20-25 percent of their print readers will migrate to the tablet within five years. (Remember, at the forecast rates, one in five Americans would have a tablet by 2014.) All admit that it’s guesswork at this point. Yet we see in their early reader pricing the acknowledgment that the real print-to-digital transition might be finally be upon us — and they don’t want to miss this ship when it sails, as they have too many others.

So they are beginning to anticipate that question: What if readers trade up? Or what if they trade over, moving from one reading experience, print in morning, smartphone on the go, desktop at work, tablet in the evening?

Let me suggest that as the newsonomics of tablets-replacing-newspapers gets serious, there are three big numbers to watch. These three numbers are the drivers that will separate out the winners from the losers, come 2015, when daily print is confirmed as a waning niche choice and digital news consumption is our way of life. They tell how us how much revenue news companies can generate and how much it costs them to produce, market, and distribute these mainly digital products, as they seek to meet two simple goals: take in enough revenue to afford a significant professional news staff, and produce a stable profit. Given how the industry flirted with unprofitability in 2009, even a stable 10 percent profit margin would be welcome, one to build on in the years to follow. The three numbers:

Subscription and “single-copy” pricing: We join this unannounced revolution now in early progress. The All-Access revolution (“The Newsonomics of All-Access”) is fully upon us as we begin the year, and it clearly will be the model of 2011, from the Wall Street Journal to the Dallas Morning News to the Augusta Chronicle, with The New York Times’ new plan the most-watched foray. The Journal’s new pitch says we’ll just give you one price ($2.69 per week for first 52 weeks), and you can get the Journal by paper, tablet, online and smartphone. That’s the most prominent offer; also offered are the “Print Journal” $2.29 per week and “Online Journal” a $1.99 per week. The idea: Why mess around with less than a dollar a week, when you can just say “yes” and read it whenever, wherever you want. The big play here: getting readers conditioned to paying for digital access. The big side benefit: Fewer people may terminate their print subscriptions (in the short term) because they are just paying once for access across all product types. While digital subscription revenue is the big key here to reestablishing two revenue streams for news publishers, one-off sales will become increasingly lucrative. “Single-copy” becomes less about buying a single day’s paper and more about buying a selection of content from that brand (and increasingly aggregated, multi-brand news products), special sports and features products tailored to individual interests.

Advertising pricing: This is the huge question mark. Early tablet adopters — the Journal, the Times, the FT, The Economist, Reuters — reaped outsized rewards in advertising in 2010. These early advertisers didn’t worry about effective CPM rates, or trackability; they knew they were buying into being first and prominent in the hot medium of the year. They have paid effective CPMs of more than $100, without blinking, or 10 times or more what they pay these same newspaper sites to advertise on desktop or laptop editions. Yet the raging ad revolution will come to tablets — pay-for-performance, highly personalized direct marketing, social marketing, geo-located couponing, among other innovations — as the platform becomes mainstream. Inevitably, rates will fall — but how far, how fast and to what level of stability? Will money to go disproportionately to single-brand products, as they did in 2010, or will the Flipboards, Facebooks, Instapapers, and first-in-aggregation winners (Google, Yahoo, Microsoft, and AOL) find ways to grab a big portion of the ad revenue as they’ve done with online advertising so far? Where will the big marketing-services move fit it on the tablet, as local publishers increasingly sell a range of digital marketing choices to local small and medium small businesses? How will the privacy battles play out on the tablet, arguably the most personal of digital experiences, limiting a little or a lot publishers’ ability to market to these customers?

What we’ll be looking here is for some new evolving metrics. In the old world, print newspapers took in $600-plus, annually, per unit of circulation. Of course, online that number is less than a tenth, though that’s really been a bogus comparison because an online visitor doesn’t compare to print subscriber in brand identification or likely usage over time. Still, news brands in the digital age will inevitably find a strong smaller core of loyal readers (who may pay them and as importantly read them often) and a larger group of occasional search- and social-driven users who are less revenue-vital. How much per year digital news brands can drive per loyal reader and per occasional reader will tell us a lot about how big a journalistic staff they can support.

Costs: If most revenues are digital — sooner than later — than most costs should transition as well. With most revenues still print, print media, newspaper and magazines, have found themselves in the awkward positioning of supporting two business models, one dying, one being born fitfully — and the result has been painful. So if the enterprise becomes mainly digital, then major cost reductions are in order. Most publishers find it near-impossible to disentangle their businesses right now, but they’ll also tell you that 60 percent or more of their costs are tied up in Old Metal, Old Trucks, Old Offices. Flash forward to what we might call The Patch Age, of fewer office buildings, mobile journalists, and none of the hard costs of early 20th-century manufacturing and trucking, and you’ve cut out lots of costs. Of course, for news publishers still maintaining a print business (and print should remain a lucrative niche, if done right), these costs can’t be eliminated. They can, though, be largely segregated from the digital business. As they’re segregated and reduced, cost structures become much more reasonable to manage.

Add up the three numbers, and we have the glimmer of sustainable, new digital-mainly news models — ones as applicable in many ways to the Bay Citizens and Texas Tribunes as to The New York Times or The Miami Herald. The revenues may not ever match 2005 levels for many publishers — but if costs can be cut substantially, new profitability and sustainability can be found. 2011 will be the early clay in which those models take shape.

Conventional wisdoms are odd things. Who have thought, for instance, that the Social Network movie would propel Mark Zuckerberg to new heights of respect, given his Wonkenstein portrayal?

To that point, here are 11 conventional wisdoms, heard in various quarters, as we approach 2011. How they pan out will tell us a lot about the shape of the new year:

1) Readers won’t pay for non-business content. Yes, we know that readers will pay for the Wall Street Journal and the Financial Times, and that Consumer Reports, which helps us save money, counts more digital subs than anyone else. While some smaller dailies have begun to poke around the edges of digital reader content, Exhibit A will be the New York Times, with its new metered payment system to launch early in the year. If the Times can claim one to two percent of 30 million or so uniques (its internal count) — or 300,000 to 600,000 paying customers — that’ll be a major milestone.

2) Without Google Juice, newspaper sites will die of thirst. Google sends many newspaper sites a third or more of their traffic. It’s been a friendly flow (circa 2000) that fast turned addictive. While it is still the main source of traffic, the Juice is being devalued in two ways. First, social media, mainly Facebook and Twitters, is the number one growth driver for news traffic, amounting to about 10% for most sites as we end 2010. As importantly, social traffic, publishers will tell you, converts better — in usage, registration and wallet-opening for subscriptions. Second, publishers have assigned lesser value to search traffic — fly-by, some sniff — as they aim to really satisfy their top 10% of regular visitors.

3) The newspaper business is coming back. Well, those hopes are ebbing, even in the exec suites. The newspaper business is the only media business still down in 2010, year over year, about 8%. Print advertising continues to flag; most companies are budgeting flattish for 2011. This week digital advertising passed newspaper print in the U.S., as it had in Japan last year and will probably do in Europe soon. The future, simply, if there is one for these companies, is digital. So we’re seeing lots more movement to online-only (not bundled) ad sales and lots of digital reader revenue plans. For a business that took in only 12.9% of its revenue from digital sources in 2009, the new business will look far different — the question is of what scale and size  – in 2014.

4) Brand advertising is just as important as ever. Yes, brand advertising is spurring nice tablet sales — sponsorships on the tab are still au courant — and make up the bulk of newspaper company revenues, in print and online. Yet pay for performance, trackable advertising, is about half of all the digital ad spend, and will increase over the next several years in share. So, here’s the big question to be tested: how will the lines between brand (image) advertising and pay-for-performance blur in 2011, as advertisers and agencies demand more accountability from their spend?

5) Tablets are just another device. There’s a we’ve-seen-it-all-before-sense here for some content producers. Aren’t tablets just another device, like phones, which cost a lot of money to format for, but don’t produce game-changing revenue results? My sense: the tablet is the post-print reading device. Any publisher who doesn’t plan for tablets to hasten the print to tablet demise will be left out of the future.

6) The aggregation model is over. Google won the first round of web, raking in unbelievable revenues and profits, with fellow players Yahoo, AOL and Microsoft. That proved aggregation was king, and money would flow to those doing the aggregating, not those aggregated. With the tablet, we’re at the beginning of a new round. Almost all the first products are single title, though Flipboard, Pulse and Newsy have stood out as early, non-Googley aggregators. Soon, we’ll see what Ongo — the consortium of New York Times, the Washington Post and Gannett — is up to in aggregating paid content. We’ll also see what the Apple iNewsstand looks like.  And where is Google in this game?

7) News wires are an essential for doing business. The Reuters America product is a shot across AP’s bow, as it struggles to set a new direction. Clay Shirky has brought up some more good questions about how the current digital wave is changing syndication. In fact, disaggregation and re-aggregation, practically on-the-fly, are increasingly possible, and anyhow, most of the digital plays are niches, local or topical, and have less need for a wide net of “wire” content. The bets of Reuters and AP, as well as all the features syndicates and wires, is that pre-packaged, bound-by-labels, certified-by-brand content still is valuable. My sense: It’s the blend that works, as Reuters is beginning to test by bringing third-party content into the mix, or as a new class of content integrators — backed by analytics engines — enter the market.

8.0) Patch will tank; Rupert’s Daily will flourish. Or is that Patch will flourish, The Daily will tank? It’s a bettor’s paradise. Patch is a loser, according to all the conventional wisdom, an old media model ( paying journalists!? ) in new media AOL clothes. On the face of it, it does look like AOL is trying to make up its start-up losses on the 500+ sites by …. creating more sites. (Make it up on margin.) Yet, there may be a bigger game here, as geo-located shopping begins to grab market share and AOL integrates Patch traffic into its larger family of sites. The Daily could be the USA Today of its era; first out of the block — a new newspaper for the tablet. Or it could be a dead-end, a once-a-day cycle in an continuously updated world. My sense: It’ll depend on the product’s voice and sensibility. Does it give me a great, new outlook on the day’s happenings, or not; tablet news reading may re-emphasize those traditional editorial qualities.

9) Public Media is different from Private Media. Yes, and no. In general, non-profit organization journalism has broadly set a new standard in 2010. Certainly, there’s public radio, with its myriad new initiatives and big plans for the years ahead. Then, there’s the rocket launches of Bay Citizen and Texas Tribune, joining MinnPost and Voice of San Diego. They all show that high-quality (sometimes higher quality) journalism can be as well done in non-profit redoubts as in struggling-for-profit downtown office complexes. Then, there’s TBD.com, a for-profit start-up that looks a lot like the non-profits. One lesson: The old labels won’t stick.

10) Brand is everything. Certainly, we see the re-ascendance of Big Brands, from Comcast, Netflix and HBO to Amazon, Apple and News Corp. Given the economic cycle, that’s entirely predictable: big companies usually have the cushion, if they act smartly, to sustain recession damage, and grab market and mind share. In fact, I think we are seeing greater value of big brands, for instance in tablet news product innovation. Who’s there early on? The big guys: Reuters, BBC, WSJ, NYT, Bloomberg, Guardian and more, while the little guys are largely sitting on the sidelines “assessing the market.” Counterpoint: Flipboard, small and VC-funded, has broken through noise, based mainly on good thinking and real innovation — and now has its brand certified by Apple, which picked it App o’ the year. 

11) Bigger is better. For a decade and a half, news publishers have been chasing big numbers — page views and uniques — as their businesses have struggled. We’re now moving into a smaller-can-be-beautiful era, as news companies and media brands of all kinds focus more intently on core their core audiences, those who really identify with and use their brands. The idea: get those customers to pay, satisfy the hell out of them…and make secondary money on all the fly-by traffic that Google, Yahoo, Facebook and Twitter send your way.

We’ll all familiar with the chaos of the moment. Publishers and broadcasters, readers and viewers, search giants and software midgets — they all see that we’re on the verge of the next news and information revolution, as the built-out Internet really begins to power human access to content on an array of digital devices, anytime, anywhere. But it’s not just the media dealing with that revolution. The same chaos of choice that alternatively delights and befuddles envelops businesses as well.

For old-fashioned sellers of newspaper space and broadcast time, it’s been a fitful education, and a reminder that merchants don’t want to buy advertising — they want to find customers, as cheaply and efficiently as possible. The First Amendment didn’t tie merchants to media in a constitutional permanence; it just seemed that way.

Marketing spend — email marketing, social media commerce, search engine marketing and optimization, building and operation of brands’ own websites, events and conferences, among others — is increasing worldwide, while “advertising” stagnates, and that’s due mainly to the increase in digital, increasingly measurable, marketing alternatives for businesses of all kind.

Yet, it’s also clear that we’re at the beginning of this digital marketing revolution, with two numbers convincing me we’re maybe not even a tenth of the way there. I’ll call that the Newsonomics of eight-percent reach, and explain those eight percent in a moment.

Consider first the big picture of marketing spend. Chuck Richard, a fellow information industry analyst at Outsell, has done work showing that marketing ad spend in the U.S. now totals $368 billion, of which 32.5 percent is going to digital and 30.3 percent to print.

It decreased at the rate of only 4.5 percent in the recession-wracked 2009, and should rise about 4.2 percent this year. Spending on advertising alone was down 8.5 percent in 2009 and is forecast to be down 0.8 percent in 2010.

So against those numbers, let’s look at a couple of numbers.

Google reaches about eight percent of the small businesses in the country, estimates Click Z’s Gregg Stewart. That’s 1.5-2 million businesses who use Google’s ad services, contributing to its $27 billion annual revenue run rate. As Stewart points out, Google advertising is a convenience for many harried smaller merchants:

Local businesses face a multitude of challenges daily; servicing customers, generating sales, meeting payroll, and in effect doing what they “do” for a living. Basically, they’ve got their hand in everything and this rarely allows for deep specialization in any one specific facet of their business. Local businesses do not have the time required to research keywords, monitor results, and modify bids and ad creative along with all the additional complexity that is associated with SEM.

Look at that eight percent another way, of course, and we see 92 percent upside, a big opportunity to help merchants make sense of the chaos. Google — along with Yahoo, Yelp, Yellow Pages companies, AOL, and Microsoft — have been plumbing this territory, and so have newspaper companies and a trio of hungry online marketing services companies.

Now Google is making a couple of aggressive moves. It has announced Boost. It’s a product that is built on top of its local listings and Google Maps. Boost — there’s an ironic ambiguity to the name, in that it is intended to boost Google’s revenue and boost some money out of the pockets of local media — adds the ability to put ratings and reviews in place-based ads, and they are sold on a pay-for-performance basis, unlike an earlier similar offering. The Boost test is going forward in more than a dozen cities.

Secondly, Marissa Mayer, Google’s long-time maestro of the search business, is now in charge of the local business. That’s another signal of what an opportunity Google sees in local business, online and on mobile.

How much of the local business market do you think metro newspapers reach? Eight percent, estimates Mike Sacks, VP for operations at Tribune. That’s a number, give or take a couple of points, I’ve heard from other publishers as well. While that total is likely higher for smaller-circulation dailies, its small size is a reflection of the old way of selling, pre-chaos.

Newspapers worked the biggest local merchants for big contracts, concentrating on getting a relatively small number of checks from a small number of deep-pockets advertisers. Now, those advertisers — the likes of Best Buy, Target, and Macy’s — are increasingly going direct to their customers and using all manner of social and engagement media to find and upsell customers (“The Newsonomics of online marketing“).

So, newspaper companies, including Gannett, Hearst, and Tribune, most prominently, are re-strategizing. If the dollars from that eight percent are only half what they were 10 years ago, then we’d better get some revenue from the other 92 percent, they’re saying. They’re doing that three main ways:

• Retraining salesforces, and hiring more commissioned salespeople, to work the territories, selling not only space in their own papers and sites, but Yahoo inventory, Facebook placements, mobile messaging and more.
• Telesales: Think “boiler room” lite; more salespeople calling more prospects.
• Self-service: Sack’s Tribune is one of the companies using the Mediaspectrum platform to enable local merchants to place their own online or print ads. This Orlando Sentinel “Place an Ad” page shows what merchants can choose from. At the sister Sun-Sentinel, in Fort Lauderdale, Sacks says that more than a hundred new advertisers have been added in the year the service has been in place. “Every single cent is a new one…I’d like to see it grow ten-fold,” he says of the prospects of turning an experiment into a line of significant revenue. Sacks says average sized deals come in at about $1,000/$2,000 and also provide lead generation for upselling. Overall, Mediaspectrum’s self-service ad product is in place at almost 100 newspaper titles, including all of the Tribune’s papers (but not broadcast properties), UK’s Trinity Mirror chain, Morris Publications, the Columbus Dispatch, and the Washington Post. Most offer both online and print placements.

As we enter 2011, this new battle for local ad dollars is growing in strength, as merchants aim to make sense of the chaos of marketing choice. This exercise in chaos — and how sellers of marketing services do or don’t take advantage of it — affects more than just newspapers, of course. Locally, commercial broadcasters and Yellow Pages companies — the two other local media with substantial feet-on-the-street sales forces — are sensing the same opportunity to get to smaller businesses, as they, too, lose some of the bigger-business advertising they’ve long held.

Advertising agencies are in the midst of their own identity crises, as their value proposition to businesses is thrown into question, with the advances of pay-for-performance advertising and self-service overall.

The online-only players aren’t just the search giants. ReachLocal, Orange Soda, and Yodle are the companies you hear a lot about when you talk to local site general managers. They are all working the same turf, with ferocity. A recent visitor to the Yodle “sales pit” came away with the impression of “how well trained these guys are” and how their state-of-the-art customer relations management system qualified prospects well.

That 92-percent “open” market — maybe 23 million businesses — tells us how early we are in this digital marketing movement. Commerce change is one thing. For those who care about the news, the big thing to watch is whether those dollars, as they move digitally, move to companies that produce news, distribute news — or have nothing to do with news.