Those in charge of heritage media again revealed today how little they understand the internet and that they are unwilling to adapt. At least, that's how it would appear on the face of it.

News.com.au reported on the speech by APN News & Media chief executive Brendan Hopkins at the Pacific Area Newspaper Publishers' Association conference (PANPA). The glee with which the speech was reported by News Ltd sites was not entirely unsurprising, given their recent push to begin charging for content on their websites.

Hopkins told the conference:

We don't need to be reborn, we just need to be paid properly for what we do.

...thereby clearly setting out a protectionist agenda, hanging onto the old model rather than adapting to a new one. It echoes similar recent speeches by Rupert Murdoch, his son James and other newspaper heavyweights with more ink than digital awareness in their veins. The quote roughly translates to "We don't need to change. Everybody else needs to change! The internet needs to change!"

Most of the venom was saved up for the search engines.

To use an analogy, I see search engines as breaking into our homes, itemising the contents, walking out and listing everything for everyone to see. And they get money out of that process.

The analogy of search engines "breaking into homes and stealing content" is as misguided a comment as I've ever heard from someone whose business future relies on this digital space. Search engines are no more stealing content than the newsagent who also makes money by providing a channel for consumers to access newspapers. The search engines - just like the newsagents - are the distribution model any publication needs. They aren't copying information. They aren't stealing content. They are providing links directly to the news sites by assisting the readers to find the newspaper stories they want to read.

The most the search engines ever reproduce is about a paragraph of text as an extract to provide context to the link. Yet, even the content of this paragraph is under the control of the webpage in question - if the owners ever spent five minutes reading how search engines gather information.

If the newspaper companies really don't want Google or Yahoo or any other search engine to make money off providing a free distribution service for their content, they should get their webmaster to add a robots.txt file to each page of the website. This would prevent the search engines from crawling the pages and remove them from the indices. Their content will no longer appear in Google or Yahoo or whoever else has got their goat up by daring to point interested readers to their ungrateful website. Simple. It's the newspaper proprietor's choice to let them in or lock them out - to follow the terrible analogy.

Another comment leapt out as particularly daft.

Industry group The Newspaper Works, which is chaired by Mr Hopkins, is seeking talks with search providers on the issue.

A recent agreement between YouTube and the music industry, which will see YouTube owner Google pay the Performing Rights Society for use of music videos, provides a blueprint for those talks, Mr Hopkins said.

I think I know why the talks with the search providers haven't happened yet. They need to stop laughing first.

YouTube does not serve as a directory of content extracts and links - the content is reproduced and contained complete within the site. Unlike search engines, a music video on YouTube doesn't give you a couple of bars of the latest hit before providing a link to the record company website to view the song in its entirety. As the music content is viewed completely within YouTube, without any flow of traffic to the content producer, it is only right that an arrangement be made to share any revenue created by that content.

But search engines do not reproduce complete content! I think that needs repeating. Search engines are not content providers! They are merely the directory for users to find content on the sites run by the original content providers. It's like refusing to list your business in the Yellow Pages because you don't want them to make money off your business details.

But is any news boss idiotic enough to switch off one of the website's primary sources of traffic? Of course not! So what's really going on here?

They can't be THAT stupid

I'm not convinced that these newspaper bosses are that ignorant about how the world works. They have legions of talented people below them in their digital divisions who would know how search engines work and how important they are to any business model. They must know that the YouTube argument is a straw man. There must be internal data that shows how important the search engines are to their bottom line in driving traffic to their ad-filled pages. The fact those ad-filled pages are not producing a suitable revenue model is not the fault of the search engines that have certainly done their bit.

So why this continual hammering away with an argument they know to be flawed?

I don't think this is about getting the search engines to change. I don't think these speeches are directed at the newspaper men in the room (who would all be aware of the same flaws in the logic) or those IT news services that flock to report on such things. I think these comments are aimed purely at the readers of News.com.au and related sites. They're designed to be reported on those same papers. They are a deliberate attempt to muddy the facts so that readers see some justification in the move towards monetising online news content. It's propaganda.

This is a public relations battle, not a technological one. It doesn't matter how search engines work or how classified ads will never be the same again if the wider public feels there is a case to answer. This is, pure and simple, an attempt to convince their readers that it is reasonable to charge. Reality doesn't matter if public perception believes something else to be true. If sentiment shifts even slightly in their favour, it will make the job of bringing in a paywall that much easier.

These speeches are aimed at those readers who don't understand search engine technology, indexing, spiders, link strategies, advertising models and online content distribution. For it is with those readers that the battle over paid news content will be fought.

Then again - what do I know? I'm just one of those plagiarising, inaccurate, uninformed bloggers John Hartigan (CEO of News Ltd - I'll leave you to join the dots) criticised so venomously back in July.

In return for their free content, we pretty much get what we’ve paid for – something of such limited intellectual value as to be barely discernible from massive ignorance

If it's ignorance you're looking for, the News Ltd approach to search engines has it covered.

It's been 33 years since Network was released by MGM and went on to win four Oscars. Yet it seems strangely prescient for how social media and the internet have changed everything - with a particular warning for business. Cotton On recently found themselves on the receiving end of their own Howard Beale moment with consequences for their brand.

Although the Network of the title refers to 1970s big business television, the central premise could now easily be applied to social networking and the power of the individual. View this short scene - the speech that won Peter Finch his Oscar.

Finch's Howard Beale character is able to share his anger with the audience because he has the power of the broadcast network behind him - something that, back then, was open only to a privileged few. But consider how, today, anyone with an internet connection has a similar ability to broadcast their anger, share their complaint and virally whip up dissent and this film becomes particularly relevant.

The marketing and PR departments at Cotton On - the Australian clothing manufacturer and retailer - were taken completely by surprise when one complaint turned into a public outcry and media circus. For the full background, I advise you read Mia Freedman's post - Cotton On - are you on CRACK - over at Mamamia.com.au. There, she describes how a complaint from a customer about their offensive baby clothing range was met with indifference.

After all - what can one complaining customer do - right? Ignore the whingers, right? There'll always be one, right?

"Go to your windows and shout I'm as mad as hell"

I'm not debating here the issues about a t-shirt poking fun at child abuse - the topic is better discussed elsewhere. What I am discussing here is how this story grew and how Cotton On completely failed in their reaction to it.

When Freedman (@miafreedman) blogged the story and pushed it into Twitter, others who had never seen the offending clothing range became involved. Freedman became a modern Howard Beale and broadcast her anger to a wide audience in seconds. Within hours, #cottononaresick became a popular Twitter hashtag conversation with more Twitter users - and as a result more bloggers - leaping onto the cause. (An especially strong post was posted by Caroline Overington at The Punch - Cotton On thinks child abuse is funny: meet Lincoln)

As the anger grew, and one voice turned into two, then five, then a tumult, Cotton On remained silent. Their Twitter page was quiet - not a single tweet to engage and discuss with those demanding a response. (Over a week later, Cotton On have been notably inactive on Twitter, with only one new tweet promoting Father's Day.)

Now hundreds of people were commenting on the story. Customers were calling for a boycott and sharing details about how best to lodge complaints, pooling resources to create the maximum noise. This was an angry crowd determined to be heard and using social networking to organise and band together. Yet, Cotton On seemed to be praying that if they ignored them long enough, it would go away.

After all, it's just Twitter, right? These are just a few angry people, right? We're way bigger than they are, right? No one takes these over-reacting bloggers seriously, right?

The bloggers get taken seriously

It wasn't long before journalists came across the story. Soon after, it made the front pages of many newspaper websites - with the added observation that Cotton On wasn't currently commenting to journalists. A few hundred people on Twitter suddenly became thousands upon thousands exposed to the story. A complaint from a single consumer, championed and broadcast by another (Freedman), had now made it to the major news websites with a massive following of outrage in just a few hours.

By late afternoon, the inevitable back-down occurred. The Australian reported it first - Cotton On Vows to Withdraw Offensive Tshirts.

Lessons

So what should Cotton On have done? What lessons can be learned from this case study?

Primarily, it illustrates that treating consumers as a mass market and working the percentages is no longer an appropriate business model. The prevalent idea that a small number of unhappy customers is acceptable as long as everyone else keeps spending money, fails to recognise how that small dissatisfaction can now grow virally into a real business threat. Now that customers can also reach thousands of people as quickly and easily as corporations, the relationship with each and every individual becomes important. No one can be ignored or dismissed or fobbed off. You never know just how influential they may turn out to be online.

This isn't to say that every customer should be able to hold a company to ransom and that every complaint has merit - but an intelligent business should be able to recognise the difference. Yet, even when a complaint cannot reasonably be dealt with, many disgruntled customers can be appeased merely by being shown that they have been heard, and their opinions respected. Above all, responses should be swift and human - not an automated form letter or legalese. Preferably, this response should happen where the complaint or conversation is happening. If the outcry is on Twitter, engage with them there. If in the press, engage there. Comment on the blogs, reply to the emails. Don't simply send out a carefully worded press release vetted by five departments to a couple of newspapers when the heat gets too much.

Cotton On's Twitter page is a perfect example of a big brand missing the point of social networking. By merely using it as a broadcast platform for promotions, and never to respond or engage with customers, it demonstrates that they have yet to discover that the internet is a two-way medium. By failing to realise they are no longer the sole voice in the conversation, Cotton On could easily repeat the same mistake again.

Like Howard Beale, we will continue getting mad and continue to shout our anger out of windows. We have our own Network now and we know how to use it to be heard.

As technology has provided better and faster ways of tracking a customer's response to a given marketing campaign, the industry has increasingly become obsessed with numbers. This link resulted in this number of conversions. That direct mail piece resulted in that many phone calls. These poll respondents said this about the brand.

We like numbers. There is a feeling of security in being able to point to numbers to report, with apparent accuracy,  the success or failure of a particular task. It allows us to make confident decisions - yes to that strategy, no to that campaign - safe in the fact the numbers predict the likely outcome.

But numbers can lie. These numbers that we base expensive, business-changing decisions on can lead us onto completely the wrong path.

I was inspired to think about our obsession with numbers to justify everything on watching this scene from The West Wing. What Joey Lucas - the hearing impaired White House pollster - explains is how it is very easy for numbers to trick you into the wrong conclusion. Josh was concerned how five congressional districts would react to the announcement of a five day waiting period on guns. He wants to predict how the White House stance on guns could influence voter behaviour in those five marginal districts.

Part of the role of marketing is to sway target audience opinion towards the message that leads them to your product. If a marketing campaign fails because of the numbers, does it mean you should scrap the campaign, change the product or modify the sales process? Nine times out of ten, businesses will assume bad responses to a marketing campaign means the campaign was bad and the agency or marketing team gets it in the neck.

But that might not be what the numbers are saying. The numbers may be saying 'we want to buy, but the sales process is poor' or 'we would buy, if the product did this instead of that'.

We need to look past the numbers. This is where it becomes imperative to have a strong culture of listening to your audience - and I don't just mean in your established one-way channels like your feedback form on your website. If the numbers can't tell you whether the poor numbers are due to product, sales or marketing, maybe the way customers are talking about it elsewhere will. Are bloggers criticising the product? Is Twitter awash with tweets ridiculing the marketing? Are the sales team getting regular complaints from people unable to complete the transaction?

Only by listening wherever your customers congregate and continuing to ask questions would you gain the context to the cold statistics that can lead to a more accurate interpretation of what they really mean.

Be careful of numbers. They could be telling you something completely different to what you think they are.

Have you ever known someone who gives a pet name to their car and talks about it as if it was a real person? If you're like me, you think they're slightly kooky for imbuing a pile of machinery with a personality and building an emotional attachment with it. But many businesses continue to hope all their customers are equally illogical by expecting them to form relationships with a brand while only providing them with automated machinery in return.

We know technology makes us lazy. Our tolerance for doing anything seems to have been diminished by our ability to outsource so many of our day-to-day tasks to gadgets, widgets, automated thingummies, machines, appliances and more. Now we're impatient if the web takes more than a few seconds to load or if some complex piece of kit doesn't work for us straight out of the box.

This desire to automate extends to the way we relate to each other too - and this is where it gets dangerous. Many businesses approach the web as a path to automated success and treat their customers as an inconvenience that can be outsourced to technology. With content management systems, email auto-responders, plugins and more, online business owners hope to avoid all that messy, time wasting 'customer engagement'. Instead, they put gimmicks and technologies into their websites, plug it all into Twitter or Facebook, sit back and wait for the money to roll in with push-button convenience.

Just like an automatic car still needs someone in the driver's seat to actually - you know - drive, the internet still needs a human to make it work. Understanding technology is not the way to online success. Being able to code websites or bend javascript to your will or design incredibly complex software means nothing if you don't understand how people will relate to it and use it. And I don't mean how you want them to use it - I mean the way they really will. They won't push that button to do you a favour. They won't befriend your brand or engage with your website if it fakes engagement with them.

Would you ever automate your relationships with your family and friends? Of course not. Imagine how your family would feel if the only communication they ever received from you was an email auto-responder message whenever they tried to send you their news.

Dear Mum/Dad/sister/aunt Mary, thankyou for your message. I am happy to hear you are well / sad to hear about the illness. Yes, we should have lunch/dinner soon. Please select a date and time in the attached online organiser and you'll receive a confirmation email if your selection is accepted.

Yes, ridiculous I know, but isn't that how many online businesses approach their customers? Automated emails and preprogrammed clinical responses delivered by the machine.

You can't automate relationships. If your customers want to communicate with your business, they want to really talk to someone human, someone real, someone who won't just read from the company approved script or talk in corporate-speak after every word has been vetted by five departments.

Technology can help you connect with far more people than ever before in increasingly effective ways, but it doesn't remove your responsibility to behave like a human being.