It has been a hellish week for the newspaper industry. Tribune, owner of the LA Times and the Chicago Tribune, filed for bankruptcy, while The New York Times Company hocked its new Renzo Piano-designed skyscraper. Worse still was the continuing collapse of confidence in the sector’s ability to reinvent itself for the digital age. As industrial expenses – printing and distribution – account for about half of the average title’s cost base, stripping them out to offer an online-only, ad-funded service might seem a plausible strategy. Not necessarily. At current advertising rates, the number of online users needed for the average newsgathering machine to break even is beyond the reach of all but the strongest brands.

Take the New York Times Company. It generated $74.4m in online advertising in the third quarter, 10.2 per cent more than in the same quarter in 2007. But the $6.9m increase in online ad sales was dwarfed by the $73.7m decline in print advertising revenues, which plunged by 18.6 per cent. Even if it managed to halve its $677m quarterly operating expenses by dropping the hard copy, online ad revenues would cover just 22 per cent of its running costs.