If you remember a few months back I discussed how the whole idea of bailing out newspapers was terrible. I further asked where the innovation was from traditional publishers? Here is a paragraph of note (I bolded the most important text):

What I have learned as a person who has transitioned a purely print media company to an integrated media organization is that the news reporting organization of the future must embrace not just excellent editorial but it must integrate solid content with state-of-the-art SEO optimized backend content management systems. Moreover, media companies must constantly evolve their product lines and provide customers with solutions they have budgets and a need for. Lately, SEO, social media and lead generation are areas many advertisers are focusing on. Where do newspapers stand in these areas? Do they provide products to match these budgets? Are they innovating? Can you honestly say they are experimenting with new media in areas where budgets exist or are they just following each other like lemmings as they provide tablet-versions of their content in the hopes that they will win media Lotto?

Now Om Malik details how magazine apps are not selling well. They are really cool mind you – I think what Wired has done for example was pretty compelling – but there is too much free content online. I wonder, why would anyone pay for any content which isn’t used for investing or other specific purposes? Here is an excerpt:

Venture capitalist Fred Wilson makes exactly this point in a blog post Thursday, in which he argues that the economics around mobile platforms such as the iPhone and the iPad — and other tablets, presumably — will likely come to look a lot like the economics of the web itself, in which closing off access to content via paywalls and walled gardens has not proven to be a very successful long-term approach (with a few notable exceptions such as The Economist and the Wall Street Journal). As Wilson puts it:

I don’t understand why anyone would ever think that adding a presentation layer on top of web based content would make it something people would want to purchase when they are not willing to purchase the same content directly on the web.

The bottom line is content is going to stay free and you are going to have to make your money from sponsors. This means media companies must become software companies and produce products and services like Salesforce.com and other companies do. They will ideally come up with new products which afford them recurring revenue based upon providing a measurable service which helps them connect their sponsors with people who want to purchase their products.

To date there has been little innovation from publishing companies as they transition to media companies and to be honest I think it is likely too late to develop a profitable web strategy in 2011 if you haven’t gotten it right yet.