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I had dinner Friday night with Dean Mills and several other folks from the University of Missouri J-School. Not one word was said about the death of print, the crushing debt loads taken on by big publishing companies, or other depressing topics that tend to dominate journalism conversations (and blogs) these days.

It was an upbeat conversation about exciting possibilities, all hope and energy and yes, optimism. Mizzou has all sorts of fascinating projects in the works.

In the background, though, I was thinking about the  Columbia Missourian, for 99 years the keystone of the hands-on Missouri Method of teaching journalism.

The Missourian isn't a school newspaper -- it's a serious, professional, commercial daily newspaper that's operated as a teaching laboratory.

As the Number Two newspaper in a small town, it's having big financial difficulties. To be honest, hardly anybody on the "town" side of the "town vs. gown" divide reads it, and I don't think it's doing all that well on the "gown" side, either. You can't sell advertising in a paper that doesn't reach an audience that advertisers need.

Losses at the Missourian are running well over a million dollars a year, leading to talk of cutting the Missourian back from its daily publication cycle and focusing more on the Web.

Last year it spent $1.67 million on print-related expenses (composition, printing, mailroom, circulation) and only $93,722 on Web expenses, so it's not exactly been starving the past to feed the future. The daily paper reaches 7,400; a weekend free sheet reaches 43,000 homes, and the Web product claims 100,000 unique users. Think about that.

Maybe the Missourian becomes a Web-focused operation with a weekly print product, or more likely, an array of multiple targeted products. It already has a weekly free entertainment tab and a Hispanic-targeted product.

Or perhaps it might  buddy up with the competition: Hank Waters' Columbia Tribune, the "town" paper.

I've known for awhile that these ideas were simmering in Mizzou's pot. The path forward might seem pretty straightforward and obvious. But it's not simple, because of a risk of a potential backlash from donors.

Make no mistake about it: Higher education lives or dies on the largesse of donors, mostly alumni. The ones with the most to give tend to be older, which right now puts them on the opposite side of the digital revolution. Many fondly remember their college years on the staff of the Missourian, which until recently even operated its own presses.

These ideas about radically changing the Missourian are now in the open, and some people don't like it one bit. Dalton Wright, publisher of a small daily in Lebanon, Mo., and a member of the Missourian's board, already has been quoted: "I think Walter Williams would be turning over in his grave."

But I wonder how Williams really would react. What would make him roll over in his grave?

Walter Williams, for those who don't know the story, was the guy who founded both the Missouri School of Journalism and the Missourian, so you might think he'd have a sentimental attachment to the past.

But Williams was a change agent. He was a guy with a high school education who talked the Missouri General Assembly into creating the world's first journalism school at a time when reporters served trade apprenticeships rather than getting formal educations. Williams was a guy who never attended college, yet got himself appointed dean of that radical new school, then rose to become president of the University of Missouri.

It's easy when you walk through an ivy-covered campus, looking at statues and portraits of great men and women who were founders and builders and creators of empires, to drift into nostalgic fantasies about tradition and past glories. We all do it.

But those people in the portraits were pioneers, risk-takers, change agents. We don't honor their memory by clinging to what they built, but rather by understanding why they did what they did and finding new ways to apply those principles in modern contexts. Embracing the future requires learning from the past, but also letting go of it.

We need our universities to not merely churn out qualified job applicants. We need universities to take a constructive role in research, analysis, ideation and experimentation. We need help to figure out the new forms of journalism -- and the business models to support it -- that will serve society in the digital future. I hope potential donors will see and honor the needs of the future and not get stuck on preservation of the past.

At lunch Saturday, Gary Kebbel told me about a new Knight Foundation project:  a five-year, $24 million challenge grant program targeted at local information needs.

It's not handing money to projects to save newspapers. It's looking to persuade local community foundations to adopt the cause of "creative uses of media and technology to help keep communities informed and their citizens engaged."

It's open-ended and forward-looking, and likely to lead to some projects that many might not recognize as "journalism." But isn't keeping "communities informed and citizens engaged" what drew people like Walter Williams into newspapering in the first place?

Since it decided to redirect its efforts toward the Internet, one particular company's "stock price has fallen by half, the portion of its revenue derived online has stagnated at about 5% ... and its online division has been losing money since 2005," observes Howard Weaver.

Sounds like a newspaper company? Actually, it's Microsoft.

Interestingly, both Microsoft and the newspaper industry have benefited, however temporarily, from the rise of the Internet.

Newspapers, especially the Wall Street Journal and the New York Times, experienced an advertising bubble that was closely related to the first Internet bubble.

Microsoft has seen a boom in Windows licenses as millions of people bought PCs specifically to browse the Web.

And for both Microsoft and newspapers, the seeds of destruction came along with those benefits.

For newspapers, it's an explosion of small competitors, each shaving away bits of time and attention and advertising money like an army of swarming ants.

For Microsoft, the Internet has enabled geographically scattered volunteers to collaborate on open-source software that is eclipsing the functionality of its expensive commercial wares. And it's enabled the rise of rich and powerful avowed enemies such as Google, which is funding projects aimed at unhorsing Microsoft in the nascent mobile networking space as well as disruptive Web-based applications such as Google Docs.

Many of us may think Microsoft deserves what's coming to them. It's worth keeping in mind that many people hold similar opinions about the "mainstream media."

The big difference, of course, is that Microsoft today is sitting on a mountain of available cash, while newspapers are experiencing an ownership crisis.

A long time ago someone said to me: "When the parent becomes threatened by the child, the stage is set for a Greek tragedy."

If reports are to be believed, that's playing out right now in San Diego, where Karin Winner, the editor of the decaying and decrepit Union-Tribune, has engineered the exit of Chris Jennewein and Ron James, two of the best online guys in the newspaper business. Not the first time this has happened. And sadly, probably not the last.

The newspaper's audience in-market penetration has sagged to 54%, while the website has added 17.2%, according to the latest ABC data. In addition, the website has built a separate national audience/revenue proposition (out-of-market usage is not measured by ABC) based on inbound tourism. So the response is for the newsroom to seize control and oust the growth guys. Dumb.

If the world unfolded as predicted by Bill Gates, printed newspapers would be dead in the next four years. While he may turn out to have been directionally correct and merely wrong about the timing, it's been interesting to watch the world change around Microsoft and slowly render the software giant impotent at a time when newspapers continue to hang around and even start new print publications.

While it is surely premature to pronounce dead a company with a 263.2 billion USD market capitalization, the writing is on the wall: the era of the PC has ended. The Web is the center of the universe and the PC is just one of many peripherals.

Now Microsoft is saying that openly. After a series of high-profile failures (PlaysForSure, Zune, and now Vista) from Redmond, it needs to change its way of thinking from top to bottom to embrace Web services. (This is why it wants to buy Yahoo, an effort that I think will fail even if it succeeds.)

The problem is that MS has no particular advantage as a service provider -- other than mountains of available cash to fund development, which often is not the advantage you might expect. On the minus side, it has a demonstrated track record of incompetency and inability to stick with an idea long enough to make it work.

Just this week Microsoft told people who made purchases from its failed MSN Music online store that "as of August 31, 2008, we will no longer be able to support the retrieval of license keys for the songs you purchased from MSN Music or the authorization of additional computers."

Microsoft is surrounded by smart, more agile competitors, many of which have nothing to lose. As we move from desktop to mobile-centric Internet access, free Linux -- especially in the form of the Google-financed Android project -- will be the dominant platform. This will lead to an explosion of small-scale disruptive, innovative development, overwhelming Microsoft like an attack of fire ants.

Is there any value to newspapers in studying this, other than misery loving company?

I think it illuminates two options for newspaper companies, which are in many ways in the same trap as Microsoft.

One path is to embrace and leverage processes modeled on the principles of "open source" development, as Google is doing. This requires abandoning the arrogant hostility toward the reader that you find in many newsrooms, banning the language "unwashed masses" from thought as well as conversation. The Founding Fathers referred to "a decent respect to the opinions of mankind," a concept disturbingly absent among many journalists who are eager to latch onto other concepts expressed in that era, such as freedom of the press.

The other path is suggested by a line generally attributed to F. Scott Fitzgerald: "The cleverly expressed opposite of any generally accepted idea is worth a fortune to somebody." This essentially is Apple's path, the closed system where value is created through enforced simplicity and clarity. But can newspapers cleverly express anything? The quality of writing, and the quality of thought, in most of America's 1,400 or so newspapers is not encouraging.

My rule of thumb is a simple one: Use the right tool for the right job. The Internet's strength is collaborative interaction; print's strengths are linearity, focus and serendipitous discovery.

So in my world newspapers should use the Internet to execute a Google-like, open-source-inspired, conversational approach to journalism, while remaking print around focus, quality, depth and thought-provoking discovery. I'm troubled when I see newspapers trying to badly copy the Web's strengths into print (i.e. those awful Page 2 summaries of news you already know about) and failing to invest in journalism worth reading.

So in my vision of the future, the Web is not exactly the center of the media universe. It's one of the centers, and it's optimized for open interaction and community-driven conversation. Print should focus on our need for periodic escape from the cacophony of the bazaar. If we do that, perhaps newspapers will still be around for awhile. Maybe even longer than Microsoft. Who knows?

"If the only tool you have is a hammer," said psychologist Abraham Maslow, "you tend to see every problem as a nail." I thought about that as I examined a couple of recently launched websites: The Industry Standard and NotchUp, both of which bear the "beta" label acknowledging their concepts are only partially baked.

The original Industry Standard was a business magazine aimed at the magical new economy that was being created by the Internet. It went dot-poof when the first dot-boom turned out to be a dot-bubble that dot-burst.

The new Industry Standard is a website, but it's not an online magazine. While it has some news and opinion that a writer would recognize, it's really a "prediction market" that attempts to capture and wisdom from the community. You "bet" on positions, such as "Yahoo to accept Microsoft acquisition." If you're right, you win virtual money that gives you a more powerful voice in future "betting." In theory, the result is a powerful indicator, like the stock market.

NotchUp is an employment marketplace built not around scarcity of jobs, but scarcity of good candidates from specific jobs. The big twist on the usual "post your resume and get a job" offer is that NotchUp promises to charge the potential employer for the contact information and pay you for the interview.

You also get some sort of percentage on anyone you recruit to join the system, a viral marketing trick that explains why I got a blizzard of invites over two or three days.

Both of these sites, interestingly, are built on the open-source Drupal CMS platform. This gets us back to the point about Maslow's hammer. Given the same toolkit, how would a newspaper company respond? For that matter, how many cutting-edge Web 2.0 pundits would have built the usual blog-centric presentation, with maybe a little bit of sweet Ajax goodness thrown in?

We are all subject to the Maslow's hammer effect.

I'll leave it to others to comment on the potential impact on the newspaper industry of the proposed Microsoft-Yahoo takeover.

I'm interested in how Microsoft may be faced with a choice: Change who you are in a very fundamental way, or destroy both Yahoo and yourself in the process.

That is the very choice facing newspapers today, and we might learn something by considering how this takeover might play out.

Why does Microsoft want Yahoo, anyway? Here's why: It's four o'clock in the afternoon for the Microsoft software empire. At four o'clock there's plenty of daylight left, but night is on the way.

That's the way it is for Microsoft, which built its lock-in software empire in an economy of scarcity (and some shady business practices). Despite all of Microsoft's efforts, scarcity in the software world is disappearing.

The Internet is responsible for that. It made possible the open collaboration by volunteers and independent companies that created Linux, Apache, an array of free database servers, free programming languages like PHP and Python, and ultimately competitors like Google who are making the old world of desktop software and desktop operating systems largely irrelevant.

The cool stuff is on the Web, not the desktop, and we don't need Microsoft for that. This is the nightmare that Microsoft has been fighting from the start, the reason it opposed the open Internet from the start, the reason it suffocated Netscape at the start.

So it's four o'clock, and Microsoft knows it has just a few more years to move from being desktop-centric to being a Web-centric business that's more like media company.

Its own efforts (MSN) have been a mixture of serial failures and very marginal successes, so something big has to be done now.

But here's the danger: Microsoft's DNA would be poison to Yahoo. Instead, Microsoft needs an injection of Yahoo's DNA. It's unlikely to accept that.

Microsoft's internal value system tells it to tie everything together in order to defend the core. Defending the core, as we in the newspaper business have finally begun to understand, ultimately prevents you from innovating.

Instead of embracing open standards, it peddles second-rate proprietary tools like ActiveX, Silverlight, and the ill-fated "Plays For Sure" audio system, all intended to lock consumers into a Microsoft-only solution. Instead of competing on merit, it tries to prevent licensees from supporting other standards.

What a contrast is Yahoo. Like most successful Web companies, Yahoo built its business on open-source tools like OpenBSD. Rasmus Lerdorf, who invented PHP, works there, and Yahoo is probably the largest single user of PHP in the world. Yahoo contributes heavily to open-source projects, hosts open-source conferences, promotes open standards and gives away its own code. It's not perfect, but it's almost a mirror image of Microsoft.

Yahoo doesn't need an injection of Microsoft, but Microsoft could use an injection of Yahoo. Will it take the medicine? I doubt it. Like a newspaper taking over an entrepreneurial dotcom startup, I fully expect Microsoft to destroy everything that's open and creative about Yahoo, driving away its best talent and its most loyal users.

It should raise some eyebrows that MySQL AB, the Swedish maker of a free database management system, has sold itself to Sun Microsystems at a price that Cnet estimates at (begin Dr. Evil impersonation) one... billion ... dollars. Hopefully it also will open some minds about alternative business models and "low end" innovation.

MySQL's revenue model is best described as "voluntary pay." Anybody can download and use the software at no charge. Businesses are encouraged to sign up for support services, but that's completely optional.

The "voluntary pay" model isn't unique to software; quite a weekly newspapers use it, and some dailies are beginning to experiment with a mix of free and paid circulation that effectively is "voluntary pay" for targeted neighborhoods. It's an intriguing option for a print medium that lets the newspaper control its distribution while continuing to enjoy some of the revenue benefits of the old model.

In the music business, Radiohead stirred things up by offering their latest album as a free "pay what you want, if you want" download. Of course, other music businesses such as Magnatune have long offered unusual pricing models. Magnatune lets you listen online all you want, and pay a price of your own choosing to download files.

And in Kirkland, WA -- the east side of the Seattle area -- there's even a coffeeshop and deli founded by a Google programmer that seems to be surviving on a voluntary-pay basis. The wi-fi is free, too.

The MySQL deal also is significant because MySQL is a perfect example of a low-end disruptive innovation.

You don't have to stir the anthill very much to discover that a lot of highly paid, highly trained Oracle database administrators regard MySQL as junk, a toy, beneath consideration. Blah blah constraints, blah blah referential integrity, blah blah transaction rollback.

But MySQL was "good enough" to create entirely new markers and enable entirely new services, including this blog, which sits atop a MySQL data store. And as MySQL improved, it began displacing expensive solutions in increasingly more mission-critical settings.

Now it's the engine behind Google AdSense, which of course is the revenue engine behind Google itself. Good enough, and then some.