The idea here doesn't seem to be helping newspapers succeed, but helping newspapers transform into entirely new businesses. It seems like a reasonable way to make money, I just don't think it has a lot of relevance to the troubles facing the newspaper industry.

There is a difference between "journalism" and "newspapers". In a sense, journalism (hard news, soft news, tech news, whatever) is this wide idea, and newspapers are just one implementation. In the past, scarcity of information combined with advertising helped support the business end (see also: TV, Facebook, everything, etc.). It worked so well, in fact, that it could overcome the ridiculous costs of actually making this physical thing to put the journalism in and carry it to peoples' homes. Not anymore. There are examples of journalism succeeding outside of newspapers, but trying to build a physical, for-profit business around journalism seems to be a losing battle [1].

The nice thing about leaning on advertising for your revenue is that it pretty much scales with your readership which pretty much scales with the quality of your journalism and ease of access to it. The not nice thing is that the internet and Craigslist provide basically the same quality of information for free, so this once comfortable equation is suddenly completely failing newspapers. But the equation itself really hasn't changed, so it's not like newspapers can just throw away their journalism.

So the OP suggests newspapers add "digital marketing" to their sales pitch? Sure, okay, that could be very lucrative for newspapers. How does that relate to being a newspaper? If the digital marketing strategy pans out, what incentive is there for newspapers to keep providing that sillly, unprofitable journalism thing?

[1] This is old information now, but I think the basic idea still stands: http://www.mint.com/blog/trends/the-death-of-the-newspaper/?...

This is kind of right, but it's like traveling back to the '20s and telling your grandfather that he should go into iPhone contracting if he wants to make money — good advice, totally wrong audience. If the people in charge at most newspapers actually had the first clue about the Web, the industry wouldn't be in so much trouble.

This isn't an article so much as an advertisement: "Lloyd W. Armbrust is CEO of OwnLocal, a company that helps newspapers fix their revenue problems."

His idea of "fixing revenue problems" is having newspapers pay his company a bunch of money so they convert money that probably would already have been spent on local advertising into money paid for web services. No mention of how much cannibalization was involved in the case studies.