We are now in the era of homogenised media companies where digital strategies for television companies include text news and podcasts, radio companies broadcast text news and video, and newspapers publish all of the above.

The Australian will be shortly following The Times and the NY Times in implementing the first phase of their content revenue strategy, or paywalls. With The Australian, what has been a decade and a half’s teaser campaign will now switch to the business model that is intended to show the future of the newspaper industry and arrest its decline.

This is a big day for newspapers in Australia. It is a big day for newspapers worldwide. It is a big day for any heritage media company with an eye on their future revenue streams. It is a big day because newspaper revenues and readership are in an unstoppable decline.

In 2005 in the US, newspaper advertising revenue growth was reported by the Newspaper Association of America at 1.5%. In 2006 it dropped to -1.7%. From 2007 until last year it has dropped by -9.4%, -17.7% and -28.6%. Put into layman’s terms, that’s: 2006 – “hmmm weird”. 2007 – “This is not good at all”. 2008 – “Oh shit.” 2009 – “Where’s my digital strategy?”.

If we look at readership figures locally, the optimistically-named Newspaper Works industry group reported an across the board drop of over 3%. As Crikey pointed out, this is the latest in a negative and accelerating trend: “The December quarter saw a total fall of 1.98%, the September quarter, 1.55%, the March quarter in 2009 saw a fall of 0.85%”.

The solution to this problem is simultaneously very simple and very complex.

The problem is that newspaper publishers currently think like newspaper publishers. This means that the structure of the organisation is still focused around sourcing news stories, creating articles and publishing them in a single brand entity – the newspaper or newspaper website.

With the introduction of paywalls, this will change. The solution is to realise that publishers are no longer publishers, they are retailers of content, and need to think like retailers. This is a step change from thinking like Rupert Murdoch to thinking like Frank Lowy.

From top to bottom, publishers need to change their culture to think like retailers, act like retailers and generate revenue like retailers. If a publisher says: “we already think like a retailer because we sell newspapers, magazines or video” then they are the equivalent of the alcoholic denying that there is a problem.

While this is a simple strategic solution, it requires a structural and complex transformation to succeed. A couple of years ago, this sort of transformation would have been an optional and left-field strategy that most publishers were too scared to contemplate. With the dual clashing rocks of a financial crisis and audience shifts due to digital technologies, this transformation has become a necessity for survival.

In the midst of this chaos, Apple launched the iPad.

The unique support for this new piece of technology from media companies worldwide has been unanimous as far as I have seen. Print media has been particularly vocal and rushed to embrace it. Rupert Murdoch’s quote summed up the prevailing mood at its launch: “I got a glimpse of the future…with the Applie iPad. It is a wonderful thing. If you have [fewer] newspapers and more of these…it may well be the saving of the newspaper industry.”

The iPad is indeed a beautiful thing. The screen is high quality and the interface is simple. It appeals to media owners because it matches the level of vanity that they have about their content. Magazines, newspapers and books that are produced to be aesthetically pleasing can now be aesthetically pleasing away from these pesky computer screens and midget mobile screens. Editors can show off their title and say once more: “Look how beautiful my content is”. Indeed, the iPad and other tablets are perfectly designed to match the experience of a coffee table magazine – they are gorgeous couch devices and fit into our behaviour pattern of consuming glossy magazines: the lounge room, the bedroom, the kitchen, and travelling on the airplane. Initial native iPad apps from The Monthly, Editor’s Choice, the New York Times and Wired all fit this model.

Yet there is a something wrong here. A bum note in a symphony of approval.

In the mid-nineties, I ran a digital media and games company in London. A common conversation with potential clients went like this:

Client: “I need a website. Everyone’s got a website and we need one too.”

Me: “What would like on your website?”

Client: “Our brochure. We want the site to be just like the brochure. We have all the artwork on CD and everything!”.

What we were seeing was people shoe-horning old media into a new medium.

With the iPhone and iPad, the conversation is similar, except now people are wanting to put their website onto the iPhone, or worse still, exactly replicate the print experience. With page turns and everything.

This to me is the equivalent of making a movie of Lord of the Rings by filming someone turning the pages of the book and putting that on the big screen. Digital media devices are interactive beyond a page turn mechanism.

Older media folk like the iPad because it makes them feel comfortable about the direction technology is heading. It looks nice and it has a business model attached (albeit one owned by Steve Jobs who is surely the Frank Lowy of the digital world). To me, this is a dangerous assumption because the key development in digital media is its connection to the internet, not the resolution of the screen.

It feels like there is a mass seduction taking place at the moment with the iPad as the object of desire.

To visualise this at a recent presentation, I showed an image from the moment in the first Ghostbusters movie where Sigourney Weaver transforms into the lustful seductress, idolised and pursued by the equally transformed Rick Moranis. Content owners seem to be being seduced by the temptations of the iPad, while all the time Apple is rejoicing that it is getting unprecedented free marketing to support its underlying business model of selling hardware.

The situation we are in at the moment is a chaotic transformation of media as new content forms and new business models are being innovated at the speed of light. It is a time to understand that audiences are driving the change in media through their change in behaviour, which in turn is being driven by consumer technology.

It is the time to experiment prudently across multiple platforms, not just one, because that is how audiences are consuming content. And above all, it is a time to create content that uses the interactive power of the digital medium to create new ways of telling stories, rather than being seduced into republishing the same content by a technological beauty that really is only skin deep.