DISQUS

I believe there are several problems which newspapers face, but there are also tremendous opportunities for these publishers. The biggest problem is that their basic medium is outdated-- I'm not just talking about printing, but rather the idea that a local newspaper needs to be a source of every type of news under the sun. There is tremendous overlap in what's reported every day by the major dailies and news services. This made sense when the only way to get the information was via local delivery, but with the web this is a huge cost which is unjustified by the distribution.

Because of the near monopoly most newspapers have on their cities, they have been able to charge insane ad rates to reach people. What they need to do now is provide ways for a larger advertiser base to reach their local readers more efficiently. Targeting their web experience to individuals based on information they can get is the very best way to do this. In short, newspapers need to stop relying on a few huge advertisers to pay insane rates, and instead need to provide those advertisers with much more targeted ads perhaps tied to some CPA type ads, and at the same time create a huge self-service, targeted ads program for every single local advertiser in their region.

Without a consolidation of newsgathering, a hyper-local approach to news and media, and a highly targeted, innovative ads system, newspapers will die. And it will be their fault, because they are positioned better then anyone to reap the massive rewards local/regional news and media can provide.

Seems unrealistic that they would pay that much for what looks like a fairly simple blog with some web 2.0 features bolted on. Perhaps it's 10% cash, the rest on earnout?

Competition is definitely a good thing, it shows you're on to something and also allows you to sharpen your vision.

Every time I start to think about competition too much, I remember a Jeff Bezos quote which is something like: Focus on the customer, not the competition. At the end of the day, competition is a form of validation but ultimately your users only care about what is going to work for them.

In a network economy though, competition takes on some different aspects. People don't want to be where other people aren't... this is the toughest challenge facing entrepreneurs on the web-- building community is a lot harder if someone else already has a big, diverse, and robust community