This story by Paul Gillen states the plain truth about why newspapers are toast. In short, online sites handle breaking news and classified ads far more efficiently and cheaply.
The problem, of course, is that online sites have not been shown to handle long-range investigative reporting of the “follow the money” nature particularly well. They’re best at telling you when things have finally blown up, not at figuring out that corporate or political bad guys are quietly cooking the books or systematically granting building permits to their cronies.
Freed of traditional newspaper scrutiny, mid-level bad guys (in city government and business) will soon be free to embezzle, rezone, pollute, and more — as long as they don’t piss off some partner in crime who outs them to a blogger.
It would be nice, but unduly optimistic, to think that local websites and bloggers devoted to watchdogging local businesses and government will spring up to take on this work (which newspapers have nearly abandoned already). We’ll see.