Speaking at the opening Digital Leadership Dialogue event at POLIS on Tuesday, Emily Bell predicted an apocalyptic period for mainstream traditional media.
In the UK media, Bell said she could see five national newspapers going out of business, 'the regional press heading for complete market failure' and no commercial UK-owned broadcaster operating outside of the BBC.
"We are standing at the brink of what will be two years of carnage for western media. Nobody in my business has got a grip of it yet," said Bell.
"We are at the meeting point now of a systematic down turn and a cyclical collapse.
"Even the surviving brands will have to undergo a long period of what's essentially an unprofitable existence," said Bell, adding that publishers faced an 'institutional challenge' in getting the success of traditional, offline revenues to move online.
The traditional news media are failing to produce 'differentiated' content online amongst a 'hurricane of knowledge and publishing' caused by the growth self-publishing online, such as blogging, she added.
To address this outlets should move away from the editorial models of the 'age of representation', where news organisations published what they thought readers should know, she said, to an age of participation and a better understanding of who the audience is.
The Guardian made this shift following the events of September 11 2001, as the paper's website attracted a substantial audience from the US, explained Bell.
"We suddenly had a global audience we weren't creating journalism for. We thought we were creating international journalism for a UK audience.
"That's something which has accelerated in the last seven years and has reached terminal velocity."
Journalists should be actively encouraged to see news as a conversation, and the relationship with readers, such as that of BBC business editor Robert Peston, should be promoted, she added.