Although this sounds like it goes against all conventional wisdom, it is worth considering. There are several key factors to consider:

• The competition is broken.


• A start up would be free of the legacy costs weighing down current papers.


• Talent, could be lured away from their current failing employer.


• Technology and innovation will change the business model.

Broken Competition
Newspapers across the country are struggling. Burdened by debt and an unsustainable business model, they are either folding, scrapping the print edition, or scrambling to adapt. This is the best time to enter a market.

Legacy free
Similar to what Southwest did in the 80's, a start up could set up operations without incurring the burdensome and unnecessary costs that most newspapers carry. The costs of running a printing plant and a distribution network are massive and not easily shed. In 15 years, these operations will be non-existent, but unwinding them will prove complicated and costly.

Luring talent
The most talented editors and writers are working for ships that are either sinking slowly or going nowhere. The opportunity to be at the helm of something new and relevant (not to mention equity in a potential growth vehicle) will be compelling enough in many cases to lure top talent. In addition to being great writers and reporters, the best talent brings with it a built in audience who will follow him/her. If Tom Friedman were to leave the NYT, a significant portion of his readership would follow him to his next destination.

Technology and Innovation
It is just a matter of time before physical papers as we know them will no longer exist. But people are not going to give up the enjoyment of reading a physical paper. Rather the physical paper will just be in a different form. If you could walk into your den and pull a complete paper off your printer as opposed to walking out onto the front porch to get it, is that not a reasonable if not preferable option? Why no one has introduced this feature (similar to Mr Coffee) is surprising but surely to change. Doing so completely eliminates the need for the traditional and wasteful distribution model that exists today.

Additionally, newsstands across the country will follow suit. The notion of being at an airport in the early morning before the papers were delivered is archaic. So is buying a paper without sports results that ended after 10PM. Soon you will be able to walk into your airport newsstand and buy a paper fresh off the printer.

Another innovation is the Kindle. While electronic readers won't save the newspaper business, they will help. The idea of paying for content is reasonable and will become more prevalent over the next period of Internet evolution.

Moreover, Cable and Telco companies currently charge you $60 for cable television and redistribute 35% of that to the cable channels that create the content. They charge you a similar amount for high speed web access and don't share a dime with the content creators. This iniquity is sure to change over time. The ramifications for this are far greater than for just newspapers, but newspapers will factor in.

Digital newspapers are digital content, not any different from the other entertainment and information you consume over your high speed connection. The unwillingness for consumers to pay for newspapers is largely tied to their unwillingness to pay for content ala carte. The same spending pattern would be true for cable television if ala carte were ever to be offered. But when a great sum of content is bundled and offered as an up-sell on a bill that they are already paying, one's likelihood to pay for that content goes up dramatically.

If every newspaper started charging $10/mo for digital access to their site; and if your ISP offered you $40 for basic web access but $45 for access plus access to every newspaper you wanted, it would seem like a great deal. And that is where things are heading, so long as the consortium of newspapers can collectively decide to charge and they can convince the ISPs (Comcast, Verizon etc) to find a pricing model that works.

The fact that the number of parties controlling newspapers has been narrowed to a select few makes this possible. Perhaps it would be seen as collusion, but that wouldn't stop it from happening. And if there are a few holdouts, it is no different than today where several papers are free.

Finally, as interactivity on the web is better adopted and understood by advertisers, the cpms paid by the advertisers will increase dramatically, further increasing the revenue potential.

Sure there will be naysayers. Warren Buffet recently declared he wouldn't touch newspapers. But keep in mind he was talking about buying a paper, not starting one.