But will they actually pay up? Here, the conventional wisdom is not so helpful. Nor are studies predicting consumer behavior. To wit:

• Nearly 50 percent of U.S. Web users are willing to pay for online news, says the Boston Consulting Group.
• Not a chance, says Forrester (FORR): Try 20 percent.

For what it’s worth, my money’s on the Forrester number, or one that’s even lower. My gut says people love consuming news, but only in the broadest sense–Obama doesn’t really Twitter! What was Belichick thinking?–and that sort of stuff, which appeals to a very large audience, will always be free, and you’ll get it from Google (GOOG) or something like Yahoo (YHOO). Which leaves you with a small audience willing to pay for everything else.

But! We should note that people are indeed paying for “content” right now. In fact, they’re paying for a lot of it: $115 a month, up seven percent from last year, says NPD Group. The breakdown:

As of August 2009, 81 percent of U.S. households subscribed to a television service (satellite TV, basic/premium cable, or fiber-optic television service). A similar percentage of households (76 percent) paid for Internet subscriptions. Seventeen percent subscribed to an online music service or satellite radio; and 14 percent subscribed to online gaming subscription services.

More traditional forms of entertainment subscriptions, however, did not fare so well. The number of people subscribing to newspapers fell by 2 percentage points to reach 29 percent in August 2009. Forty-one percent of consumers subscribed to magazines this year, compared to 43 percent who did so last year.

According to NPD, an influx of new smartphone owners has led to an increase in mobile data-plan subscriptions: 9 percent of U.S. consumers had mobile data subscriptions this year, versus just 6 percent last year. Fourteen percent of consumers subscribed to a home-video subscription service, like Netflix, this year, which is 2 percentage points higher than last year.

Ah, see? Problem solved: If you want Americans to pony up for stuff on the Web, just link it to something they’re already paying for, like their cable or Internet subscription.

This is what smart guys like John Malone have been talking about for a while, and it’s also the core of the strategy behind the Time Warner (TWX)/Comcast (CMCSA)/everyone else “TV Everywhere” gambit. But it’s also what many people have been trying to do for a very long time–ask the music industry–with limited success.

The world’s biggest video site is trying a “small test” of optional “pre-roll” ads that run at the beginning of its clips. Click on “skip this ad” when the ad starts running and…well, you can guess what happens.

Unlike ad-skipping options offered by other sites, there’s no trade-off with the user here. You simply don’t have to watch the clip.

Given that most online advertising now seems headed in the “big, bigger BIGGEST” direction–come-ons that insist on getting in your face no matter how hard you try to avoid them–this is a pleasant change of pace.

And a smart one, at least theoretically, given that YouTube should be able to charge more for ads users don’t avoid. Just as important, the video site can collect more refined data about the performance of different ads.

I’m okay with preroll ads myself, if they’re short enough and it’s stuff I want to see. And I certainly prefer them to “overlay” ads, which clutter up the bottom of my clip with ugly text that’s a pain to make disappear. But Google (GOOG) and YouTube officials insist I’m in the minority on this one, and that the rest of you guys love them. True?

No ad at all on this one, which I’m only catching up to just now:

That’s the core of Twitter’s pitch, of course, and it has helped the microblogging service raise $155 million, a $1 billion valuation, and forge partnerships with Google (GOOG) and Microsoft (MSFT). Not surprisingly, investors are looking to place money on related bets, from search engines that parse real-time data to location-based social networks with real-time updates, and even real-time photo-sharing sites.

The newest entrant: Hot Potato, a buzzy start-up that’s supposed to let users converse about a particular event, whether they’re attending it in person or watching from afar. When it’s up and running, that is. The five-man crew doesn’t have users or a product just yet.

But that hasn’t prevented the Brooklyn, N.Y-based company from raising about $1 million, sources say, in a round led by First Round Capital and RRE Ventures. A group of smaller investors, including Betaworks, the incubator that specializes in real-time companies, and Ron Conway, the angel investor best known for his Google bet, are also backing the company.

Hot Potato is led by Justin Shaffer, an eight-year veteran of Major League Baseball Advanced Media, pro baseball’s well-regarded Web unit. Shaffer has recruited three other MLB.com employees (one of whom subsequently left to get an MBA at MIT) to join him.

Shaffer wouldn’t comment about his funding round, but was willing to discuss his start-up’s general plans. They are finishing an iPhone app and plan to submit it to Apple (AAPL) in the next few weeks, he said, and will open their doors once that’s approved.

The big idea is an interesting one. People are already using Facebook and Twitter to converse about events in real time–think about Barack Obama’s inauguration, or Balloon Boy, or last night’s Yankees-Angels game.

Shaffer’s critique of those platforms, though is that “they break at scale–there’s no good way to filter the chatter so that  you, your friends, and a group of strangers with something relevant to say can all connect. Hot Potato, he says, will offer a “curated stream” in real time of all the data coming out of the event in real time. What we’re really focused on doing is bringing together the entire audience of an event, whether they’re at the event or watching at home.”

Business model? TBD, of course. But there are a couple of obvious ways to go. For instance, Shaffer thinks people who opt-in to a particular conversation–say, about an NFL game or a U2 concert–would be okay with seeing “in-stream” ads, as long as they were relevant.

But that’s a problem that’s best tackled once the service is up and running. We’ll check back then.

The perennial, and obvious, solution is to incorporate ads into the service, but so far Twitter hasn’t tried it, except for very limited experiments.

The good news for Twitter and its investors is that the service’s user base is pretty receptive to advertising, in general terms, because it’s pretty receptive to just about everything on the Web.

So says research group Interpret LLC, which has a new study out today, conveniently enough. From the release:

Twitter users are twice as likely to review or rate products online (24% vs. 12%), visit company profiles (20% vs. 11%) and click on advertisements or sponsors (20% vs.9%) as those who only belong to traditional social networking websites like Facebook and MySpace. The data suggests that Twitter users uniquely demonstrate higher engagement with brands, not just with “tweets” they post.

These statistics are self-reported, and Interpret doesn’t say how big a sample its survey used, so take them with as much salt as you like. But they seem intuitively and directionally correct: Anyone willing to plug into the waves of information that Twitter pumps out is likely engaged all over the Web.

Note what the Interpret report doesn’t say: That Twitter users are eager to have ads inserted into the service itself.

Doesn’t matter. At some point, they’re unlikely to have a choice about that because it seems hard to imagine that Twitter can ever deliver on its investors’ sky-high expectations without generating some kind of money, somehow, from Madison avenue.

Which is exactly why Biz Stone and crew, who once made a point of expressing their derision for ads, now make a point of saying that ads may not be such a terrible thing, after all.

The movie, an over-the-top retelling of World War II featuring a squad of Jewish Nazi hunters, brought in $37 million at the box office this weekend, which is about $10 million more than the Hollywood prognostication machine expected.

In the old days, you’d simply chalk up the difference to the fact that the Hollywood prognostication machine sometimes gets things wrong. But now when this happens, the impulse is to blame or praise Twitter. The theory: Audiences go to see the movie on Friday, then quickly tweet their 140-character reviews to their pals. This either keeps moviegoers away for the rest of the weekend or makes them flock to the theaters.

All of this sounds believable enough, but I have yet to see anyone spell out exactly how it works. The Hollywood Reporter, for instance, is a big proponent of the “Twitter saved Tarantino” theory. But its evidence is awfully weak: It just notes that some Twitter messages about the film have been positive.

At least NewTeeVee tries to put some numbers behind the argument. Using data from tracking service Trendrr, it notes that the volume of Tweets about the film increased over the weekend (see chart; click to enlarge).

Of course, volume alone doesn’t indicate anything: For all we know the messages were fixated on the mustache Brad Pitt’s character sports in the film. And in any case, we’re a long way from correlating Internet messages with real-world actions–just ask former presidential candidate Ron Paul’s ardent cyberfans.

But marketing always involves at least an equal part art for every part science, and when you add a superhyped, very new phenomenon like Twitter to the mix, all bets are off. Given the way these things work, expect Hollywood to assume that Twitter can now make or break a movie. And there will be an opportunistic flock of “social media” gurus ready to assure them–for just a small monthly retainer–that their insight is correct.

In case you haven’t seen it (left unmentioned in these reports is the fact that the movie got a very big conventional marketing push), here is an “Inglourious Basterds” trailer. And below that, one of my favorite scenes from “Pulp Fiction,” Tarantino’s 1994 breakthrough. (Be warned! These are Tarantino movies, and the second clip is unedited, which means you’re going to get some potentially NSFW cursing and gore. Enjoy!)

[CORRECTION: My assertion about NPD's unit sales data below is incorrect: The tracking service counts 12 digital download singles as the equivalent of one CD. That makes Apple's share of the market that much more impressive, since singles make up the majority of iTunes sales.]

Ready to toss dirt on the old, unloved CD? You’re going to have to wait a while. Compact discs are increasingly hard to find (at least in physical stores), but someone out there keeps buying them: The ancient format still makes up the majority of music sales in the U.S.

Here are the data for the first half of the year, via the NPD Group consumer-tracking outfit: CDs made up 65 percent of the music market, while paid digital downloads accounted for 35 percent. The digital share has increased from 20 percent two years ago, and Apple’s iTunes (AAPL) alone makes up 25 percent of overall sales*, so you’re going to hear lots of proclamations about Steve Jobs’s ascent to the to top of the music industry.

But hold off on that, just a bit. Because those numbers are skewed even more in favor of the CD than they appear at first glance: They’re measuring unit sales, not dollars. And given that the majority of digital sales are in the single format (i.e., a dollar or so a pop), that means CDs (at $10 or so a pop) still account for the vast majority of music revenue.

Which is why the industry is still tied to CDs, even though no one you know buys them anymore. And it explains why the industry is working on two separate digital formats (dubbed “Cocktail” when sold by Apple, and CMX when sold by anyone else) designed to induce buyers to pay for CD-like bundles.

It won’t work. At best, they’ll convince some digital album buyers to upgrade, but the music business is once again a singles business, and it’s going to remain that way. But you can’t blame the industry for trying.

By the way, there are decent odds you’ll hear about Cocktail at Apple’s September event, which Digital Daily’s John Paczkowski says is scheduled for Sept. 9. Mark your calendar.

*If you’re keeping track: Wal-Mart (WMT) and Target (TGT) trail Apple in the overall market. And iTunes still dominates the digital download market with a 69 percent share, while Amazon (AMZN) is a distant second with eight percent.

But one observer says it’s already here: Ad optimization firm PubMatic reports that prices for ad network inventory it sees have increased 35 percent since the beginning of the year.

The firm’s data make for a hopeful chart (click to enlarge):

But these numbers could be less meaningful than they look. The most important thing to keep in mind here is that Pubmatic is only tracking prices for ad-network inventory. And if low-priced ad networks are taking market share from display ads, as is likely the case, then these numbers won’t do much good for  publishers–perhaps like the very one producing this site–who specialize in big, premium ad buys.

And the other obvious point to make here is that Pubmatic’s data are only about pricing, not volume, so they don’t really tell us whether advertisers are spending more, or less, than they used to.

But for what it’s worth, I made my own informal channel-check with two big publishers who do specialize in branded ads yesterday, and they told me things had picked up recently, as well: They differed on the degree of enthusiasm for the remainder of the year, but both cited demand from entertainment advertisers, as well as for advertisers of consumer packaged goods.

So maybe Pubmatic’s numbers are at least directionally accurate. That’d be nice, right?

CEO Chuck Townsend said as much in a memo yesterday announcing that he’d hired McKinsey to figure out how to survive “in an emerging economy that is now predicted to be painfully slow in recovering.”

But when you see Condé’s projected numbers for its fall issues, which are traditionally bulging with ads, it’s even more startling. Particularly when you realize that the economy had already been slowing down a year ago (Disclosure: I do some free-lance work for Condé title Vanity Fair).

Take a look for yourself in the table below (click to enlarge): The numbers in the middle (faintly highlighted in blue) represent the year-over-year decline in ad pages, if you factor out the publisher’s special “Fashion Rocks” issues, which it gave up on last year. The more brutal numbers on the right are the “real” numbers. All of them are unpleasant.

Using the more favorable set of numbers, Teen Vogue is Condé’s relative star, down a mere 17 percent. And if Vogue was a publicly traded stock, it would have beaten expectations, since it came in above 400 pages–which is still down 29.7 percent (or more).

Not included the above chart: Totals for The New Yorker, Golf World, Modern Bride or Elegant Bride, since they aren’t monthlies and don’t have comparable September issues.

And here’s a trailer for “The September Issue,” a much-buzzed about documentary about Vogue’s effort to put out…well, you can figure it out.

The post, written by two YouTube PR folk, purports to be a bit “myth-busting” about the site’s business model and financial status. But it’s really a series of assertions with little data to back up the claims, many of which we’ve heard before.

So really, the big takeaway here is that the Google folks are feeling ever more confident about YouTube’s prospects, enough to do some public chest-beating. But not enough to actually talk about those prospects in concrete terms.

For instance, YouTube says that estimates that the site can sell ads against only three percent to five percent of its video inventory, first asserted in a well-reported Wall Street Journal piece a year ago, are “old and wrong.” But the company won’t say what percentage of the site it does sell.

Likewise, the company says that analysts’ attempts to peg its bandwidth and hosting costs are off the mark, but doesn’t say what the real numbers are. Nor does it address the amount that YouTube has to pay content providers, either through upfront fees or revenue splits, for their clips.

And the most meaningful boast, I think, is one the company more-or-less made last week: “We are at a point where growth is definitely good for our bottom line, not bad.”

So when will Google finally start coming clean and offering up real data about the site’s performance? Got me. But here’s one indicator to watch for: What the company tells investors.

In Google’s 10-Q, for instance, YouTube is usually described as a black hole that has yet to generate signficant revenue; the company noted the same thing in its most recent quarterly report. A new 10-Q, for the quarter the Google just reported, should be out soon. Let’s see what Google has to say about YouTube in an audited filing.

In a post from co-founder Biz Stone, the company counsels users that, with the exception of a single account, none of their personal information seems to have been exposed as a result of the hack. But before establishing that, Stone goes out of his way to explain that Twitter’s security problems are Twitter’s security problems, not cloud computing’s security problems or Google’s (GOOG) security problems.

This attack had nothing to do with any vulnerability in Google Apps which we continue to use. This is more about Twitter being in enough of a spotlight that folks who work here can become targets. In fact, around the same time, Evan’s wife’s personal email was hacked and from there, the hacker was able to gain access to some of Evan’s personal accounts such as Amazon and PayPal but not email. This isn’t about any flaw in web apps, it speaks to the importance of following good personal security guidelines such as choosing strong passwords.

That last line seems directed at the likes of analysts like yours truly, who suggested this morning that the hack would raise concerns about the security of services that place work data on shared servers accessed via the Web. (Though the Twitter guys did seem to like my underwear-drawer metaphor. Cool!)

Stone then goes on to rattle a sword, gently but pointedly, at Web sites that have published stuff pilfered by the hacker.

We are in touch with our legal counsel about what this theft means for Twitter, the hacker, and anyone who accepts and subsequently shares or publishes these stolen documents. We’re not sure yet exactly what the implications are for folks who choose to get involved at this point but when we learn more and are able to share more, we will.

Note that while it’s easy enough to find this stuff on the Web, only a handful of mainstream Web sites, including TechCrunch, Gawker and Silicon Alley Insider, have published it, and most of what they have published is banal. I’ve asked all three sites for a response to Twitter’s response.

In the meantime, TechCrunch’s Mike Arrington, who has promised to publish more, announces in a new post that he is in the midst of “negotiations” with Twitter’s lawyers about his plans. Happy to hear from a First Amendment specialist, but I don’t think Twitter has a case against Web publishers here; the issue is an ethical one, not a legal one.

UPDATE: Here’s Gawker Editor-in-Chief Gabriel Snyder’s “bring it on” retort:

It’s hilarious to see Twitter, which has become a conduit for real-time, unauthorized information from places like the New York Times’ internal meetings, now get prissy about corporate privacy. Ev Williams seems to have learned a lot about the mores of the institutional elite during his stay in Sun Valley. As for Twitter coming after us for publishing the docs, the only thing I’m upset about is that the leaker didn’t come to us with them first.

My gut: Not a needle mover.

The summary for June: Google (GOOG) is flat, and so is IAC’s (IACI) Ask and Time Warner’s (TWX) AOL. And Yahoo (YHOO) is down. Microsoft’s increase of 0.4 percent, to 8.4 percent, looks to have come at the expense of Yahoo, which dropped from 20.1 percent to 19.6 percent.

Yesterday, JP Morgan’s Imran Khan (who supplied us with these data today) predicted that Bing would eventually boost Microsoft by two percent, at the expense of AOL and Ask (click charts to enlarge):

So says video-tracking service TubeMogul, which reports that Twitter users who click on a referral link to a Web video are likely to stay longer than people who get to the video from Facebook or Digg. Tubemogul has a handy chart to make its case here:

Tubemogul thinks this is surprising data, but the results make perfect sense to me. Digg users race in and out of Web pages with amazing speed, and the bigger Facebook gets, the less meaningful your “friends” list becomes, which means you’re more likely to be steered to something you really don’t care about.

But since you’re self-selecting the people you pay attention to on Twitter, their referrals should be more meaningful. This is where the Twitterati’s praise of the “passed link” as a new currency has some real meaning.

Tubemogul’s data come from a three-month survey of video links from the three services, totaling more than 6.7 billion video views. TubeMogul notes that it can’t say which services it tracks, but simple math makes it an awfully good bet that one of them is Google’s (GOOG) YouTube.

All-righty. Time to put Tubemogul’s data to the test. I just asked my Twitter pals to send me the best YouTube clip they’ve seen all day, and these are the first three responses I got (thanks @smalera, @laceyhaines and @derekbrookmeyer). See if they hold your attention (Warning! One of these is a clip of Kubrick’s adaptation of a Nabokov novel, and no one falls down, gets hit in the head or explodes at any point. Just so you know.)

But game sales have been weak in 2009, even as movie theaters set box office records. What gives?

I’ll let someone else try to explain the movie side of the ledger (although those box office numbers aren’t always what they seem to be). But it turns out that there’s a simple explanation for game slump: It’s that gamers are huddled in their basements playing Grand Theft Auto over and over and over.

Gamers are indeed spending more time playing videogames, say new data from Nielsen. It’s just that gamers aren’t spending more money on games. Instead, they’re playing the games they have, buying used games, and increasingly turning to game subscription services.

Here’s the argument in chart form–you can get a summary here or download the full report here (PDF). Click on the charts to enlarge:

Hours played:

Used games purchased:

Subscription rate:

All of which explains why Best Buy (BBY) and Wal-Mart (WMT) are both getting into the used game business and why Blockbuster (BBI) and GameFly are expanding their game rental business. Now, if you’ll excuse me, I’ve got to get back to my game of Hover Kart.

But if you’re part of the large group of people who think that nothing is really private on the Web and that everyone should see everything you do online, then you’re really going to like Facebook’s new privacy policy. It’s designed to get Facebook users to share as much as they can with as many people as they can–including people who aren’t on Facebook.

Facebook tries to explain the policy changes in a lengthy blog post here, and you can find a slideshow that accompanied a press conference the company just held here.

But that will make your eyes glaze over. Here’s the short version:

• Facebook is simplifying the privacy setting controls it offers users. So if you want your pals to see your keg stand from Saturday night, but don’t want your parents to be privy, you should be able to do that more effectively. The company is experimenting with different ways to present the controls.
• Facebook also wants to encourage people to use the “everyone” setting, which right now just means “every Facebook user.” But the company is going to eventually change that setting to mean “everyone on the Web”–meaning that Google (GOOG) users, marketers, whoever, will be able to find that stuff, too.
• Facebook wants to expand the amount of data its users share with the world because the company thinks that the more exposure data get, the more valuable the data become. But it is doing its best to tamp down complaints from users who accidentally end up exposing kid photos or bachelor party snapshots or whatever. Hence the new, improved privacy controls, which are being rolled out before “everyone” really means “everyone.”

I know, I know. That short version wasn’t that short. But you’re going to hear plenty more about this in the coming weeks. Consider this a first chapter.

The one exception to the drought: Companies that have something, anything, to do with mobile. The Jordan, Edmiston Group says deal volume increased 45 percent over the last year, and the value of those deals leapt by 38 percent.

Granted, we’re talking about fairly small numbers to begin with–the bank counted 16 mobile deals in the first half of this year, compared to 11 a year ago–but it still seems telling, and right. We’ve been hearing about the inevitable rise of mobile as an advertising, content and commerce platform for years, but in the last year or so, this now seems plausible, due in large part to the adoption of smartphones from the likes of Research in Motion (RIMM), Apple (APPL), and, perhaps, even Palm (PALM).