II my previous blog posting, I celebrated the return to profitability of newsmedia companies – a step back from the abyss. I noticed a few comments in the blogosphere that I was celebrating a return to normalcy.

Quite the contrary.

Saving a company from death is a first step and should be applauded. The follow-up question is what these re-scaled media companies will do with their profits.

Will they continue sinking resources into black holes such as editorial department coverage of topics that are irrelevant to today’s consumer, big printing monstrosities, preservation of departmental silos, payouts of enormous dividends, and the pursuit of large advertisers at the expense of the small?

No, the big companies have a lot to prove before a prolonged celebration.

Here are 10 questions newsmedia industry CEOs should be asking themselves about the reformulation of their budgets and plans over the next 18 months:

1. Are you shifting capital expenditures to products and services that provide intimate knowledge of the consumer that can be used across multiple content platforms?

2. Are you carving out 5%+ of your revenue for marketing and another 2%+ for research and development?

3. Are you shifting marketing expenditures from broadcast media to narrowcast media, including social networks and digital formats?

4. Are you investing in online tools to allow small businesses to create a marketing relationship with you?

5. Are you prioritising an advertising sales force focused less on big accounts than on metric-driven solutions and relationships?

6. Are you actively collaborating with peer newsmedia companies nationally and internationally, bilaterally and through connective groups like press associations?

7. Are you moving beyond circulation and beyond readership – to audience development across platforms with an eye toward community development?

8. Are you identifying 3-4 passionate niches – beyond “local” – that will attract fervent interest within your geography and beyond?

9. Are you investing resources to make “local” sexy, attractive, and relevant to your consumer base?

10. Are you holding all employees accountable to metrics – including the editorial department?

If the answer is “yes” to all 10 questions, you are moving the Ship Of State and ready for the next stage in the transformation of your company.

If the answer is anything short of “yes” – “no,” “sort of,” “yes, but we’re different” – then there’s not much to celebrate other than you made one quarter of P&Ls look good.

Once we've right-sized our companies to the current environment, how we engage the market is the next step in our transformation. Once we’ve done that, we can talk about business models.