Traditional media companies that refuse to invest in the Internet and withdraw into old business models are destined to fade away, opening the door for entrepreneurs to take advantage of the lack of innovation.

That was the message from Merrill Brown, a media consultant and former editor in chief of MSNBC.com who was speaking this morning at the Drilling Down on Local conference in Seattle.

Brown said that there are some examples of media companies -- citing Seattle's Fisher Communications' recent purchase of Pegasus News -- that are thinking creatively about the Internet. But he said the "macro trend" does not point to much innovation coming from traditional media.

Brown is especially skeptical about television, saying the business models for the big networks and their affiliates will make it difficult to make the transition. "For my money, they are treading water," he said.

Brown also addressed the failure of the hyperlocal news site Backfence.com, saying the stock options he holds as a former board member are worth less than a glass of water.

Source: blog.seattlepi.nwsource.com via mtippett