Five myths about news media, especially online

If you asked me to trust Clay Shirky or Tom Rosenthiel more on discussing the future of news media, I know my answer, in a flash, would be Rosenthiel. He's been doing this longer than Shirky, in a more "dedicated" fashion, and more on the ground.

Plus, unlike Shirky, Jeff Jarvis and similar, he's not a mindless booster of the Internet.

That said, here's a short take on his five myths about the news media. They include seeing the need for paywalls, because unlike Shirky et al, Rosenthiel actually is looking at media business/financial models, and, also, he recognizes that ads alone just won't pay the freight.

That said, here they are:

1. The traditional news media are losing their audience.
The 25 most popular news Web sites in the United States, for instance, all but two are “legacy” media sources, such as the New York Times or CNN, or aggregators of traditional media, such as Yahoo or Google News. ... The crisis facing traditional media is about revenue, not audience. And in that crisis, newspapers have been hardest hit: Ad revenue for U.S. newspapers fell 48 percent from 2006 to 2010.

2. Online news will be fine as soon as the advertising revenue catches up.
Such hopes are misplaced. In 2010, Web advertising in the United States surpassed print advertising for the first time, reaching $26 billion. But only a small fraction of that, perhaps less than a fifth, went to news organizations.

3. Content will always be king.
The syllogism that helped journalism prosper in the 20th century was simple: Produce the journalism (or “content”) that people want, and you will succeed. But that may no longer be enough.

The key to media in the 21st century may be who has the most knowledge of audience behavior, not who produces the most popular content.

4. Newspapers around the world are on the decline.
Actually, print circulation worldwide was up more than 5 percent in the past five years, not down, and the number of newspapers is growing. In general, print media are thriving in the developing world and suffering in rich nations.

By and large, American newspapers are suffering the most. Roughly 75 percent of their revenue comes from advertising, vs. 30 percent or 40 percent in many other countries, where papers live and die by circulation. That means the collapse of advertising is not hitting papers elsewhere as hard as it is hitting them here. It also suggests that the need to charge for online access may be even more important abroad.

5. The solution is to focus on local news.
Going “hyperlocal” was the war cry of Wall Street to the news industry five years ago. The reasoning was simple: In the Internet age, when users can access content from anywhere, it didn’t make sense for local operations to compete with the big national news providers.

The problem is that hyperlocal content, by definition, has limited appeal. To amass an audience large enough to generate significant ad revenue, you have to produce a large volume of content from different places, and that is expensive. On top of that, many hyperlocal advertisers are not yet online, limiting the ad dollars.

Now we are entering what might be called Hyperlocal 2.0, and the market is still up for grabs. Google, which garners two-thirds of all search advertising dollars nationally, doesn’t exert similar control over local advertising. Locally, display ads — all those banners and pop-ups — are a bigger share of the market than search ads.

But how to produce local content remains a mystery. ... So far, no one has really cracked the code for producing profitable local news online.

Nos 2 and 5 are pretty much direct blasts at Shirky. And I agree on both. No. 3 is the troublesome one, to a news idealist. That said, much of what the MSM pumped out in the past was news-lite anyway.

Overall, thoughk this is a good overview.