What’s with all these old friends and acquaintances passing away?

Today, it’s Tom Synder, host of NBC’s “Tomorrow” show, which came on after Carson in the 70s. The picture at the right was taken at the Milwaukee Press Club’s annual dinner in 1979. I was chairman of the event, and I arranged for Tom to get the “Sacred Cat” award, a high journalism honor in the community. Tom grew up there and was most appreciative of the award, thanking me in a note especially for how happy the event had made his mother.

His career began in news in Milwaukee, and he eventually anchored in Philadelphia and Los Angeles before leaving the news business to do “Tomorrow” in 1972. He was, in many ways, the prototypical news anchor of the 70s, but he was an extremely intelligent and witty man.

No comments about my appearance, please.

Tom died this weekend of complications from leukemia. Tom Synder, gone at the age of 77 but not forgotten.

I’ve been following the development of WiMAX for a long time, so news this week that Sprint has added Google to its team to make a WiMAX network available next year got my attention. Never underestimate Google, folks. I think this is a major development in the growth of 2-way, wireless video communications, to say nothing of what it will mean for data.

Let’s back up a minute. WiMAX is a high speed wireless technology with 30 times the speed of any 3G wireless network and with a reach of over 30 miles. Think WiFi on steroids. Sprint and Nextel began building a network in 2004. That same year, Intel began producing computer chips with WiMAX built in. A lot of people raised a leery eyebrow at the time, because we don’t even have a valid 3G network in this country, so why build one that’s essentially fourth-generation?

Enter our wise old friend, Google. According to a report in Online Media Daily, Google and Sprint are building a portal specifically for this network.

In the as-yet unnamed portal, Sprint’s high-speed wireless service (which includes location detection) will be combined with Google Apps (including e-mail, chat and calendaring), allowing consumers to browse the Web, buy products on-demand, and stream media on devices ranging from laptops and PDAs to phones and music players.

“This is a play to get Internet access in a very broadband way through a number of different devices,” said Peter Cannistra, director of Sprint’s mobile broadband business. “WiMAX is being built out for laptops and fixed computers, but we’re working to put the chips into wide array of consumer electronics.”

The report adds that Sprint will do a beta rollout of the service (including Google Apps) in Chicago, Baltimore and Washington, DC by the end of this year, with more widespread service available by April of 2008.

I believe this will accelerate the disruption that’s dismantling the media ecosystem in the U.S. and place greater emphasis on mobile, direct marketing. The network contains “location detection,” for crying out loud. Talk about a gold mine for advertisers!

It’s also fascinating at a time when the news is filled with stories about the FCC’s auction of broadcast spectrum. WiMAX is a bird-in-the-hand for Sprint and now Google, so the only question is when will AT&T buy Sprint, so that the iPhone will work better?

(I know. I know. Shut up, Terry!)

It is a natural human tendency to discover cause when something occurs outside our plans for life. I went through an agonizing period after Allie’s death, for example, trying to find out if there was something I could’ve done or somebody I could sue to right the “wrong” of her sudden departure. Pain does this. I guess we figure that if we can find out what causes tragedy, we’ll be less likely to deal with such pain again.

Besides, “revenge is a dish best served cold,” as Khan said to Captain Kirk.

There’s a great verse in Ecclesiastes where the preacher says that “time and chance occurs to everyone.” This doesn’t sit well with us, because it says that life is bigger than we are and that, well, shit happens. And it happens to everybody, regardless of their position in life.

But in the modernist world view, this can’t be. The need to determine cause is more than wishful thinking; it’s absolutely essential, because in order to maintain the hierarchy and for things to run smoothly, “proper” paths must be identified. The rigid view of right and wrong is upheld throughout the culture, because it benefits those in the right, usually the haves. This is why a bendable legal system — as witnessed by so-called “case law” (not in the constitution, BTW) — is such a vital fixture of the modernist culture.

I say all this, because four people were killed yesterday when two TV station helicopters collided in Phoenix while covering a police pursuit. My heart goes out to the families, friends and co-workers of these men.

From every corner, blame is being assigned. It’s a sensational story with sensational video that can be used to make sensational stories about police chases and their value to the news community. Lawyers are knocking on doors, and analysts are on the sets of various cable news shows. Let’s string up the bastard who did this, and we’ll all feel better!

In the early days of my news career, I was taught that “reaction” was the second day lead. Today, it’s blame, the assigning of fault. It’s as automatic in journalism as “if it bleeds, it leads.” This is then followed by a punishment phase, during which we lambaste the culprit six ways to Sunday. At times when we feel powerless, this helps us feel powerful. And so it goes.

It was an accident, but you’ll not hear anybody say that, because of our view that all accidents can — and should — be prevented. There’s always an insurance company to be sued, and so forth.

Meanwhile, the deconstructionist, postmodern culture looks at this and asks, “Where does the blame stop?” Is God to blame for allowing it to happen (or making it happen, depending on your religious view)? Do we blame life? Human nature? The air? The sky? Nobody ever blames the weather, because we can always fall back on my favorite, “He should’ve known better.” You see, you can’t sue the weather, but you can sue somebody for not knowing about it or somebody else for not providing an accurate reading of it.

Postmodernism says that when you deconstruct any stated narrative, grand or otherwise, you’ll ultimately find that you’re chasing your own tail (that’s a terrible over-simplification, but it works for me). Postmodernism is the Age of Participation, and if we’re truly to be participative, then we must necessarily be a part of cause and blame as well.

Who killed those four skilled and professional news people over Phoenix yesterday? We did.

Once upon a time, a small church in rural Pennsylvania got a new pastor, and everybody was excited. The nice-looking young man brought smiles to the faces of the blue-haired ladies, and his first sermon was on love. “Wonderful,” the congregation agreed as they exited the church afterwards. “Thank you so much. Pastor.”

The next week, everybody was a little surprised when the new pastor spoke again about love. Week after week, the sermons began to all sound the same, and one woman couldn’t contain herself as she took the pastor’s hand after the service. “Pastor,” she said, “why do you keep preaching about love? What about sin? What about right living?”

The pastor answered with a smile, “When I believe the congregation fully understands this topic, I’ll move on to something else.”

I feel that way sometimes, as new versions of old themes keep popping up across the media landscape.

Umair Haque, the brilliant London Business School economist that I’ve written about so many times, writes today of new investment in Twitter, the cool text-messaging application without a business model. Why would anybody sink real dollars in a business that has no business?

This is where the old theme comes in. I’ll state it, and let Umair expand. The disruption of Media 2.0 is, at core, a disruption of mass marketing. Hence, “new media” applications built on a mass marketing foundation are not part of the disruption.

This approach - an almost disturbing lack of interest in the business plan/model/etc - is something all of today’s great media investors have.

…When an industry requires total economic reinvention - new assets, capabilities, revenue streams, market space, the whole nine yards - it’s futile to stick to the sterile nostrums of a printed “business plan”.

This should be intuitive. Total economic reinvention implies almost perfect uncertainty. Under conditions of perfect uncertainty, it’s a suckers bet to put faith in rigid plans.

Now, this isn’t to say that you should descend into irrational exuberance, and forget about value creation and value capture altogether.

Rather, what counts is the ability to tap (better yet, create) many different kinds of revenue streams, offsetting the systematic risk of investing in the space in the first place.

…There’s little strategic point in focusing no how, for example, to grow a next-gen media business to $50m in revenues or how much $$$ ad nets make if it’s the larger economics of the industry which are in an almost total state of flux, because the new value chain hasn’t yet emerged.

Put another way, too often, these kinds of elaborate analyses built on fixed assumption have a very steep opportunity cost in industries where resources, competencies, revenues streams, business models, etc are exactly what are undergoing seismic shifts - they blind us with illusions that fixed cells in spreadsheets are strategy.

Spreadsheets aren’t strategy.

Rather, next-gen investors are better off understanding why and how value creation and value capture will shift over the next 2-5 years - and then invest in plays which can dominate those shifts.

Numbers are important - sure. But it’s understanding the deeper economic logic which really counts.

“Spreadsheets aren’t strategy.” Brilliant!

This is precisely why I tell people that you can’t left-brain your way into right-brain thinking and why I have so little faith in the conclusions of the NewspaperNext project. “Innovative” solutions, it concludes, begin with the spreadsheet about which Umair speaks, and that’s as problematic for media companies trying to reinvent themselves as it is for investors.

This is why Simulpath™ is so crucial to understand and why we must throw off the burden of tying everything we do today to a revenue stream. It’s not blind faith; it’s a deep understanding that the revenue runway for a lot of this has to be a long one, which is why Media 2.0 is best viewed as an investment.

And for me, this is a vital aspect of my work, because my passion lies with positioning local media companies for tomorrow. If we can bring ourselves to get in sync with the disruption, we’ll be far ahead of our local competitors, but that means thinking like motivated and informed new media investors.

A lot of people ask me about how you do ads in feeds, and I think Facebook does it well. The bullhorn icon (nice metaphor) announces it’s an ad, and I’m free to skip it if I want. The creative challenge is to get my attention up front, which TBS does rather nicely here.

New eMarketer data reported by Online Media Daily reveals strong growth for online video advertising, including a whopping 89% increase this year. The report projects growth rates near or above 40% through 2011 and notes that next year should provide the watershed moment for online video, when over half of all web users in this country will be watching it.

This shouldn’t surprise anybody watching this space, but the report’s author, David Hallermam, has two concerns that make future estimates problematic:

One concern, he said, is uncertainty about what the audience will accept in terms of video ad content, placement and length. The other concern is the difficulty in gathering enough video ad inventory, with questions about ad placement and how to monetize the billions of user-generated video streams.

“Video ad inventory” is one of those mass marketing statements that presupposes static systems. That may be a concern to traditional marketers, but it misses one of the key points about online video: it doesn’t have to be “attached” to somebody else’s content (e.g. “The Smart Show” by Holiday Inn Express). Video classifieds are going to explode, and all of this bodes well for local media companies.

And nobody knows local media online revenue like Gordon Borrell of Borrell Associates. Borrell agrees with the eMarketer numbers, but he tells me that they will be boosting their own projections later this year.

The eMarketer consensus estimates are pretty much on target with what we’re seeing at the ground level for online video advertising — which is only to say that everybody tracking the actual numbers are coming up with similar estimates. However, our numbers — part of the eMarketer estimates — are going to be adjusted upward significantly this fall. We’re seeing a great deal of growth at the local level as smaller advertisers buy online video commercials, but we’re seeing some incredible growth at the national level that no one seems to be tracking accurately at the moment. Automotive, packaged goods, telecommunications and job-recruitment are the key categories. Real estate has begun to explode as the agents try to market themselves and find snazzier ways to move higher-priced homes.

There was a time when many media company executives scoffed at the Borrell projections, but Gordon’s wisdom is being validated every day. One thing he’s always pointed me to has been the online ad significance of local cable franchises, and he says they are the ones to watch as online video advertising grows.

The sleeper in all of this is local cable operators. Their lower-priced TV commercials have sold nicely, but the “on demand” aspect of online video seems to be capturing advertisers’ attention more. Cable operators already have the systems in place to reach the type of advertiser eager to buy video. They know how to produce the video at low cost. The Internet has given them an extra weapon in their arsenal: Not only will they air the commercial spots, but they’ll also put it online where people can view it 24 hours a day. And they own three very powerful marketing vehicles: their own cable avails, a gateway page for their broadband subscribers, and the envelope that contains the monthly bill. In short, local cable operators are likely to seize the online video advertising opportunity faster and more successfully than their broadcast competitors in the market.

As I’ve said before, it’s hard to convince broadcast sales people to accept commission on lower-priced sales when they view their time as better spent chasing big ticket advertisers. I’m not sure that will continue to be a valid argument for long, but it does underscore the need for local media companies to dedicate sales people to work the web exclusively.

I agree with Gordon that the local cable operators are ideally positioned to score big hits in an online, on-demand world. The only question is are they smart enough to see that?

WARNING: Broadcast bias ahead (or not).

The title statement comes from a Wall St. Journal article today — “Political Ads Stage a Comeback in Newspapers” — that proves the difficulty of media organizations covering their own industry. Despite the excellent factual data provided, the piece still comes off as self-serving — so slanted that it’s vertical.

The story itself is a predictor of good things to come in 2008 for the newspaper industry.

At a time when many categories of newspaper advertising are declining, the political message is making a comeback. As overall spending on campaigns doubled to $3.1 billion between 2002 and 2006, the amount spent on newspapers, including their online editions, tripled to $104 million, according to PQ Media. The rate of growth appears to be highest in races for local posts, such as mayor and state legislator, because newspapers boast greater penetration and influence in small- to medium-size markets.

The article notes that despite the growth, newspapers account for less than 5% of advertising dollars spent on political campaigns.

But the Newspaper Association of America couldn’t have done a better job of writing what comes next:

Newspaper readers vote at above-average rates. Even amid circulation declines, newspapers in many markets reach an audience that is competitive with any single broadcast channel, a strength that online editions are bolstering. Online editions also are reaching a demographic group that their print editions have been losing — the young reader.

…Newspapers also allow for more sophisticated arguments than are delivered in the typical 30-second television campaign.

While I don’t necessarily doubt any of those statements, they are stated as fact without attribution in a publication that’s a part of the industry. This is why it’s so hard to cover media news from the inside, but if the WSJ doesn’t do it, who will?

Even when addressing conflicting evidence, the writer offers an apologetic:

A poll last year by the e-Voter Institute asked about 200 political consultants to rank nine media by effectiveness. The consultants ranked newspapers next to last, behind not only broadcast and cable television but also blogs, radio and direct mail.

That perception conflicts with polls showing that voters rank newspapers third, behind broadcast and cable television, as their primary source of political news and information, says Thomas Edmonds, a Republican political consultant who has studied the issue on behalf of the Newspaper Association of America. Moreover, surveys taken on behalf of the NAA have shown that voters rank newspapers ahead of other media in the credibility of their political messages.

Only one opposing viewpoint goes unchallenged, and that involves a national Democratic consultant who says the primary use of newspapers during a campaign is “trying to get good coverage.”

The article then goes on to note how broadcasters do a better job at basic sales, and that this is one of the reasons newspapers don’t fare as well when it comes to political advertising.

Like I said, it’s tough to cover yourself and be fair. But here’s another thought. Media critics would have a field day if one of the broadcast networks did a similar job on a piece involving political advertising on television.

Here’s the link to this week’s newsletter. Steve’s on vacation, so it’s all me. Whew.

I talk about unbundling and niches, behavioral targeting, and how the YouTube debate will spawn others at the local level, among other things. Enjoy.

This is a worthwhile read, not because it rips the iPhone, but because Shelly has such a nice way of telling it like it is. And the way Shelly sees it, the iPhone isn’t ready for business use, and he provides 13 good reasons why.

Should you buy one? If you want to be the coolest kid on your block, sure. If you are happy with AT&T/Cingular as a wireless provider, sure. If you are willing to carry an additional cell phone to make important calls, sure. If you are seeking knowledge about the future of personal communications and want to “see for yourself,” sure. Otherwise, I’d wait for at least one, if not two, generations. iLove my iPhone. I truly do. It’s just not suitable for the purpose for which it was designed. This may sound negative, but it’s not. We all own many beautiful things that don’t really do much. My iPhone is techno-art and I’m happy to have it.

I didn’t buy an iPhone, and I’m enjoying the conversations with the folks at my Verizon store about various iPhone issues and about how the Apple “phone” has lit a fire beneath the butts of LG, Motorola and other providers to offer similar services. Stay tuned.

Some people simply have too much time on their hands. This is hilarious, especially if you have a television news background or anything resembling a geek gene in your DNA (or both).

Thanks to TechCrunch for the tip.

My dear old friend Pete Wilson, a television legend in San Francisco, has passed away, and I am sad. He was only 62, and died of a massive heart attack during surgery for a hip replacement.

Pete and I were best friends during the 70s, when we both worked the morning shift at WTMJ-TV. I can honestly say I’ve never been closer to a man in my life than I was with Pete back then. We were inseparable, and since we were on the same schedule, our private lives were intertwined as well. Some weeks, we’d leave after the noon show and play golf Monday through Friday.

Pete was a terrific and passionate golfer. Big and strong, he could hit the ball a friggin’ mile and we were always competitive. I remember one round when I had him by a shot going to the last hole. He kept trying to psych me out, but I hit a great drive. We walked and laughed, and Pete seemed resigned to the fact that I was going to beat him. My ball was up the left side of the fairway, about 20 yards in front of a big bunker and 120 yards from the pin. He walked with me and then headed to his ball 20 to my right. As he left, he said, “Don’t hit it in the bunker,” which I then proceeded to do. I bogied the hole. He made birdie and beat me by a stroke. Damn.

I also remember a Christmas morning when we were both working. Cognizant of the reality that nobody was watching the 6am news on Christmas day, Pete brought his famous holiday egg nog. It was mighty tasty at 4am, but it also went straight to the brain on an empty stomach. I’ll never know how he got through the newscast.

Pete, I love you and I pray that God is holding you now in His everlasting arms. May you rest in peace, my dear friend.

The FCC’s 700 MHz spectrum auction got a little more interesting last week when Google told the world they would bid a minimum of $4.6 billion provided certain conditions were met. This is a very important move that could actually help the people who “lost” the spectrum in the first place - broadcasters.

Before I get into this, a disclaimer: I’m not a spectrum expert, but I have a pretty good bullshit detector. I’ve also commented for years about how Europe and Asia are beating the crap out of us in applications of third-generation cellphone technologies and broadband networks. You need to look no further than our beloved incumbents in the telecom industry to assign blame for that, and these are the same folks who want and need that spectrum to maintain their grip on certain forms of communication. Every claim by anyone in this debate, therefore, is self-serving, with the exception of the small group of voices pushing for open access.

As I reported a couple of weeks ago, FCC Chairman Kevin Martin’s idea of open access really isn’t open at all, but Google’s proposal is. In a truly open broadband network, anybody could play. In the incumbent’s view — and in that of several other entities involved in the auction — they would determine who could play based upon how much money would be involved. This is the same closed-network concept that has driven our wireless systems to the competitive basement worldwide.

If Google is successful, however, broadcast companies will have much more flexibility in creating business models that use spectrum that used to belong to them in the first place. The irony of this is stunning.

For the uneducated about the whole spectrum matter, here’s a nice primer from Om Malik a few months ago. Om provides a 10-step explanation, what he calls “a little cheat sheet.” It’s a good read.

And regarding the Google bid, Michael Arrington at TechCrunch has a terrific summary that includes the four conditions that Google is “recommending.”

1. Open applications: Consumers should be able to download and utilize any software applications, content, or services they desire;
2. Open devices: Consumers should be able to utilize a handheld communications device with whatever wireless network they prefer;
3. Open services: Third parties (resellers) should be able to acquire wireless services from a 700 MHz licensee on a wholesale basis, based on reasonably nondiscriminatory commercial terms; and
4. Open networks: Third parties (like internet service providers) should be able to interconnect at any technically feasible point in a 700 MHz licensee’s wireless network.

But the Arrington piece nails the BS in the incumbents’ response:

AT&T’s response to Google’s letter was breathtaking in its audacity:

Not satisfied with a compromise proposal from Chairman Martin that meets most of its conditions, Google has now delivered an all or nothing ultimatum to the U.S. Government, insisting that every single one of their conditions “must” be met or they will not participate in the spectrum auction. Google is demanding the Government stack the deck in its favor, limit competing bids, and effectively force wireless carriers to alter their business models to Google’s liking. We would repeat that Google should put up or shut up–they can bid and enter the wireless market with any business model they prefer, then let consumers decide which model they like best.

For anyone who doesn’t look too closely at the issue, AT&T’s response seems very reasonable: keep government regulation out of the spectrum let the market decide which services win. But that isn’t really what would happen at all. If fewer government restrictions are placed on the bandwidth the auction winners will be able to extract more profits at the expense of competitors and consumers. So naturally they don’t want to see open access rules like those recommended by Google. The incumbents also don’t want to see Google play in their sandbox and bidding against them - so they have yet another reason to oppose their proposal.

As the leader in the open internet world, Google stands to benefit in a purely open wireless world, but so will we all. Big or small, a level field of play will mean an explosion of creativity and applications that we can’t even imagine today. Just look at what has taken place in the 802.11 spectrum (Wi-Fi) since the FCC made that truly open. From your cordless phone to your home wireless network to hotspots in various public and private locations, all are there using “free” spectrum.

This is an enormous political minefield for Washington with billions of dollars at stake. Thankfully, a lot of extremely well-informed people are paying attention on behalf of the (relatively) shallow pocket folks in the country.

Google News delivers the best headlines. Sorry, I couldn’t resist:

Based on earnings reports issued this week by publicly-traded media companies, one has to wonder how struggling newspaper companies linking their online futures to a struggling internet company can possibly make a real difference in how either can boost revenues and, subsequently, profits. This question has been bugging me ever since the original announcement that a consortium of newspapers would be working with Yahoo to provide local news to the web giant and split revenues.

That question looms large in the wake of 2nd quarter reports by all involved.

It’s been a rough week for newspaper companies:

• The Journal Register (22 papers) Q2 profits fell 44 percent to $5.5 million from $9.8 million the year before.
• Media General saw its profits tumble 74.8 percent. Q2 net income was $5.1 million, compared to last year’s net income of $20.2 million.
• Dow Jones reported profits fell 26.5 percent, posting earnings of $21 million versus $28.8 million one year ago.
• While Gannett’s profits were up 18% due to asset sales, revenues from its newspaper unit were down across-the-board.
• McClatchy told analysts that Q2 net income fell to $39.95 million from $44.1 million in the year-ago period. That’s a 9.5% drop.

Meanwhile, Yahoo said its profits fell 2% to $160.6 million in the second quarter compared with $164.3 million a year ago, and reporters, like Verne Kopytoff of the San Francisco Chronicle, came away from the analysts’ conference with less-than-confident appraisals.

In what could be confused with a confessional, Yahoo Inc.’s executives listed their Web portal’s problems Tuesday and then promised to engineer the greatest transformation in the struggling company’s history.

The comments, by CEO Jerry Yang and deputy Sue Decker, came during Yahoo’s second-quarter earnings call, after yet another subpar financial report. They underscored what many analysts have already speculated: Change is coming to Yahoo’s business. The question is how much.

The answer will have broad repercussions for Yahoo, which is being pummeled by Google Inc. and a growing crop of upstarts such as MySpace and Facebook in the race for users and online advertising. Although still profitable, Yahoo’s business is eroding, prompting a major reorganization at the company and ample hand-wringing by investors.

There’s a lot of speculation about Yahoo being an acquisition target, and analysts note that the company is counting on the deal with the newspaper companies to help lift its revenues.

So Yahoo is looking for the same lift that the newspapers are seeking, and I can’t figure out how that’s going to happen. Online is the big bright spot for newspaper companies (although the numbers are small, they’re at least headed upwards), and nobody’s been able to fully explain to me how this can possibly be a win-win. The papers will be using Yahoo’s ad-serving software, which will give them access to Yahoo’s considerable local users in sections of the portal beyond the local news they’ll be providing.

But doesn’t Yahoo need that revenue? And sharing the revenue means less for either, right? Is the assumption that promotion from all of these markets will drive new revenue for Yahoo simply because they’re using its ad-serving tools? I just don’t know, and my concern is always for the local media companies.

Meanwhile, other web-based pureplays reported earnings this week with much better outlooks:

• Google’s profits soared 28% but fell below analyst expectations for only the 2nd time since it went public in 2004. Revenue for the period totaled $3.87 billion, a 58 percent increase from $2.46 billion at the same time last year.
• eBay Q2 profits jumped 50 percent to $375.8 million from $250 million last year.
• Microsoft’s profit was up 7 percent, hitting $3.04 billion, compared to $2.83 billion the year before.

One final note. Media company investors are different than technology investors, and they have different expectations. I continue to believe that we’ll see more and more public media companies go private in the months and years ahead, so they can concentrate fiscal efforts on building for the future rather than responding to investor demands.

There are many people throwing penalty flags at the NFL over recent rules governing who can do what with their product. The league has banned local TV news photographers from the sidelines, limited media use of game video to 45-seconds total, and now is requiring sideline photographers to wear sponsor-logoed vests. Every other professional sports league is watching this, so the ramifications are troubling for traditional media, to say the least.

A lot of people think the NFL is being absurd. After all, didn’t television, newspapers and magazines “make” the NFL what it is today? Talk about biting the hand that feeds you!

But that same logic can be said for the television network affiliate system, and look where that’s headed.

So rather than write about how silly it is to have photographers dressed like NASCAR drivers or the unfairness of it all or the ethics involved, I think it’s important to look at where this is all headed in the Media 2.0 world.

We must always remember the central theme of Media 2.0 — that anybody can be a media company in a distributed, fragmented, disintermediated, and technologically-friendly scenario. No set of traditions or rules or values or principles that existed previously apply. This is why it’s so very hard for mainstream media companies — who’ve made their mark following precepts and traditions previously thought immune to disruption — to really enter the Media 2.0 world.

The NFL is now a media company, and it doesn’t care who objects. It doesn’t care, because it doesn’t have to care. People can increasingly get to its games or highlights via its own cable network or online initiatives. If the networks (they’re not really networks anymore) want to carry games, the price will keep going up until the numbers just don’t work anymore. When that happens, the NFL media machine will simply sell ads on its own and keep the money that used to go to television.

It’s also useful in this discussion to point out that the symbiotic relationship between television and the NFL is one that benefits both. As much as broadcasters can claim that their efforts built the league, the league can also say its games built or helped build the networks and their affiliates. The networks need the games to provide eyeballs to which they can promote their program line-ups, and this is a big reason why they’re willing to pay so much money for rights. Local broadcasts of preseason games are big money-makers for the stations, and shows with the coach or Sunday night sports programs bring in large dollars, too. So it’s naive to suggest that the relationship has benefited one over the other.

Professional sports is a big content business, one that people are accustomed to paying for. The NFL regularly sells out stadiums, and it’s likely the next step will be pay-per-view, followed by ad-supported pay-per-view. The movie industry has proven that we’ll sit through commercials to watch a film from a seat we just paid $10 to occupy.

The traditional media world is being torn apart by disruptions from every quarter, most of it driven by Media 2.0. The challenge isn’t only to extend our brands to every conceivable platform; we simply must find creative ways to participate in the personal media revolution as well.

The NFL horse has left the barn. Who will be next?

The concept of advertising as content is a tough one to grasp in a world where ads surround or interrupt other forms of content. But it’s a critical Media 2.0 idea to get your mind around before you can create applications for distributing this kind of content and make money in the process.

This year’s Annual Ad Spending Study by Outsell Inc. shows that advertisers in the U.S. think the most effective online marketing tool is their own website. According to a report in Online Media Daily today, they’ll spend almost 12% of their total 2007 advertising budgets on their own home pages. Email and search marketing came in second and third.

Reports like this send clear signals that media companies cannot ignore. None of the top three ways advertisers want to spend their online money involve the traditional Media 1.0 model. Advertisers have been supporting content for many years, and we’ll see an upward curve of advertisers creating their own in the years ahead.

We’re also going to see advertisers working with each other in sophisticated ad networks that place ads on advertiser and other business sites — sites that match contextually with the people those advertisers are trying to reach. As I’ve reported before, the new airline Skybus is running ads on its site with Apple’s iPod being one of the first. If you’ve traveled on a commercial jet anywhere in the last couple of years, those white ear bud cords are in every row.

You’ll begin to see aggregator sites that use the content created by advertisers to fill pages and applications. This is a role smart local media companies could be playing, if they could just get past the idea that the only value they have is the news content they create. While that may be their core competency, their sales staff is an edge competency that can be exploited to develop a powerful new revenue stream.

UPDATE: Rex Hammock writes in the comments: “To the traditional media channel ‘owners,’ this fact is clear: Your advertisers are now your competitors.” Amen.

Here’s the link for the latest AR&D Media 2.0 Intel newsletter. Today, Steve and I talk about Making News: Texas Style, the TV Guide Network’s reality show about small market television news in Odessa, Texas. We also offer tips for making a conference worthwhile based on Steve’s recent experience in Valencia, Spain, and offer some valuable tips for a successful online video strategy.

I must point to this wonderful “debate” between Andrew (The Cult of the Amateur) Keen and David (Everything is Miscellaneous) Weinberger from the Wall St. Journal online. Read the whole thing. It’s really quite enlightening.

Thank you, David.

In what I view as the smartest move to date by any local media company, Fisher Communications of Seattle has purchased Pegasus News of Dallas. I know both groups, and I can’t think of a better marriage than this.

Fisher is run by some very smart people these days. Colleen Brown, CEO, and Rob Dunlop, Senior VP Developing Media, have a clear vision of tomorrow, and this acquisition proves they’re on the right track. Pegasus is run by Mike Orren, the smartest guy I know when it comes to hyperlocal data acquisition and running a website as a direct marketing tool.

But here’s what’s so incredibly visionary about this deal: not only will Fisher use the Pegasus platform to enhance its online offerings in the markets it currently serves, including Seattle and Portland, but they will also be able to build franchises in any market they choose. Pegasus currently serves the Dallas market, so Fisher has now opened shop another major market. This is smart and a profound statement of clarity as regards the ability of anybody to create any form of media anywhere these days.

In making this deal, Fisher has announced to the world its intention to develop more along the lines of an internet pureplay company than a Media 1.0 company using all its resources to expand its market reach. Brilliant!

Here’s the press release. Here’s Mike’s announcement to his users.

Fisher is a company to watch. My hat’s off to them.

(Transparency: Fisher is an AR&D client.)

Dan Gillmor, who wrote the book on the subject, has an excellent status report on the state of citizen media that’s well worth the read. A portion:

We’ve come a long way. There’s a growing recognition and appreciation of why citizen journalism matters. Investments, from media organizations and others, are fueling experiments of various kinds. Revenue models are taking early shape. And, most important, there’s a flood of great ideas.

But we have a long, long way to go. We need much more experimentation in journalism and community information projects. The business models are, at best, uncertain — and some notable failures are discouraging. Dealing with the issues of trust, credibility and ethics is essential; as are more tools and training, including a dramatically updated notion of media literacy.

Dan gives ten points, each of which are their own “story.” Must read, IMO.