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photo credit: qnr

This article is a reprint of my February 21, 2008 RealMoney column

The last year hasn’t been a good time to own a newspaper. The best performing stock was Washington Post (WPO), which managed not to decline significantly. New York Times (NYT) and Gannett ( GCI - Annual Report ) are down as much as half, while smaller firms like Lee Enterprises (LEE), Belo Corp. (BLC), McClatchy (MNI) and Journal Register (JRC) have registered declines ranging from 60-80%.

Today’s surprisingly strong Q3 guidance from Gannett (GCI), which results more from zealous cost-cutting than from a turnaround in the newspaper advertising market, nonetheless has triggered a buying frenzy in, of all things, newspaper stocks.

Check it out:

Maybe the best thing for newspapers struggling to understand the Web is to not try.

In his latest column, New York Times media columnist David Carr writes that he's discovered a newspaper that is "double-digit profitable, and it has been growing at a clip of about 10 percent a year since it was founded in 1999, right about the time the Web was beginning to put its hands around print's neck."

Its secret: "It aggressively ignores the Web."

The paper is the TriCityNews in Monmouth Jersey. Says publisher and owner Dan Jacobson:

The Huffington Post took $25 million in funding to set a $100 million valuation yesterday. AdAge's Michael Learmonth points out that makes the Internet's paper-less newspaper more valuable -- on paper, so to speak -- that quite a few of the kind printed on dead trees:

It's been a dismal year for ad-supported businesses, but not everyone is getting hurt. A look through recent public company statements on their ad businesses shows a trend: those worst off are (a) exposed primarily to the U.S. ad market, and (b) have the most print and TV in their portfolios.

That's double trouble for many newspaper companies, which spent much of the 90s buying up local TV stations. And it isn't helping those with big cable TV portfolios, either -- but at least those businesses also get revenue from cable subscriber fees, which remain strong for companies like Viacom.

More bad news for newspapers: Lee Enterprises (LEE), which owns 54 daily papers in 23 states, says that not only is traditional newspaper advertising down in Q2 (expected), but online advertising is down 9.1%, too. Lee's online business consists of 126 local Web sites corresponding to publications as big as the St. Louis Post-Dispatch to very small like the Weekly Calistogan in St. Helena, Calif. It's a sign that as bad as print advertising has been, local papers aren't competing well for local online ad dollars, either.