Times are hard for print

Though online ads constitute a small part of newspaper revenue, the profit margins for those operations is growing quickly, reports Editor & Publisher.

A report from the World Association of Newspapers says online operations that have moved beyond the start-up phase are generating profit margins of 40 percent or more. That's above the standard operating profit of 23 percent for papers normal operations.

Online ads account for about five percent of the revenue for most papers according to the report. While margins might be high, the income from online advertising is not expected to make up for falling revenue elsewhere for quite some time, with only 10 percent expected by '08 to '09.

Revenue from overall online operations is currently around 10 percent for US papers.

The report faults newspapers for not creating stronger brand loyalty online at outset, when they frequently had separate strategies for online and print operations.

But newspapers are wising up. Online home value site Zillow recently landed a number of newspaper liaisons, and larger print publications are reportedly uniting to build an online ad network of their own.