Emerging digital media is not about throwing video or advertising online and expecting consumers to hand back cash, but is instead about converting attention into action via referral and conversation.

That call came Tuesday at the nextMEDIA conference in Toronto from keynote speaker Shelly Palmer, managing director of Advanced Media Ventures Group.

Palmer told delegates that most attempts to monetize online video fail, not least because producers mimic a broadcast model.

‘There’s a reason for that. [Online video] looks like TV. And the old TV business has a well-protected set of margins,’ he argued.

But Palmer said margins for online video get ‘crushed’ in a democratized multi-platform world where users have choices. And that makes converting attention in the digital arena into ad dollars difficult, if not impossible.

Palmer advised nextMEDIA delegates to create online content worth sharing between users in social communities as the best path to ultimate profitability.

Only by creating a ‘purchase funnel’ to snag consumers will online producers meaningfully make money with their content, he said.

‘Awareness, interest, desire, action — those are the stages of the purchase funnel, where you drive the consumer to knowledge and doing something about your product,’ he said of new currencies beyond ad dollars for the Internet.

Palmer had supporters at nextMEDIA in fellow online producers, but also critics as the clash between old and new media resurfaced.

Barbara Williams, EVP of content at Canwest Broadcasting, said her network was willing to embrace new digital platforms to bring advertisers and audiences together online. Her network is making content available on video-on-demand, on the web, including full episodes of its hit series House, and streaming news content and promos that drive online users back to its main conventional and specialty channels.

But Williams added Canwest was not about to give away for free a traditional TV business it built up over time.

‘We have to be playing with these tools, to help advertisers get more in front of the consumers. But there’s also $600 million in traditional TV revenue that we have to protect as we play here and here and here,’ Williams told a panel on re-engineering the broadcast business.

Toronto-based multi-platform producer marblemedia was the big winner at the Canadian New Media Awards Tuesday night as it picked up the company of the year award and executive producer Mark Bishop was named producer of the year.

Bishop’s partner, Matt Hornburg, earned the CNMA trophy for producer of the year in 2007.

Other 2008 winners include Toronto-based producer Viigo being named most promising company of the year, and Vancouver-based Next Level Games winning for excellence in gaming for Mario Strikers Charged.

Toronto-based Daniel Riley was named best designer of the year, Evert Pot won for best programmer, and Toronto-based producer Toon Boom Animation picked up the trophy for best kids product for Flip Boom.