There’s an interesting look at the problems of newspapers online by Robert Ivan at Seeking Alpha, focusing on the New York Times. I don’t know about the assumptions — I’ve seen the cost of the NYT’s newsgathering put at $200m — and I’ve simplified it a little, but here it is:
Despite the highest readership of any newspaper in the United States, the New York Times only generated $330 million in online advertising in 2007. Total operating costs for that same year totaled $2.9 billion.
It is widely reported that total newspaper operating costs would be reduced by 35% if newspapers eliminated their print product [is that assumption really right?]. Using the NYT example … costs could be reduced to $1.9 billion. Continue reading