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Will E-readers Help Save Newspapers?

E-readers like Amazon's Kindle DX represent a way for news publishers to cut costs in addition to capturing new readers and revenue streams. Newspapers are drawn to cutting general print and circulation costs, which often represent 30% to 50% of their total costs. In an e-reader model, this distribution would cost the publisher virtually nothing. Dallas Morning News publisher James Moroney thinks e-readers give newspapers a new lease on life.

By 2012, Forrester anticipates an e-reader market potential of 12 million people. In comparison, daily newspaper circulation was roughly 48 million copies in 2008. So far, The New York Times, The Boston Globe and The Washington Post offer subscriptions on the Kindle DX.

The Post is working on a trial in which the paper subsidizes the cost of the DX -- currently going for a hefty $489 at retail -- as part of a bundled subscription. The missing link, however, is the advertising model. "The biggest unknown right now is, how much are advertisers willing to pay for an ad on an e-reader," says a Cox Media executive.



The experience of reading a newspaper in a print format still appeals to many people and publishers would be foolish to discount the many readers who still like packaged, edited content. E-readers' strength is that they are closer to the print product than content delivered on a Smartphone or even on the Web.?

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