First good news for industry! Online readership up!

At last, after months of reports concerning the newspaper industry's struggles to survive, Nielsen Online reports that online newspaper readership improved 10 percent during the first quarter of this year. The statistic is based on the average number of unique visitors reported by newspaper Web sites, and this latest finding proves that readership remains strong despite shrinking advertising and classified sales revenue figures.

The real challenge facing the newspaper industry is not attracting more readers (that segment of the industry is actually growing), but figuring out to generate more revenue to accompany the growth in online readership. It's worth noting that online revenue boomed from 2005-2007, and it only began shrinking when the economy crashed last year. Might we see a rebirth in online advertising once the economy improves?

Also, can the newspaper industry afford to wait for the economy's improvement without first making some drastic improvements to its current business model? Our opinion at Scooping the News is that despite online readerships boosts and the notion that an improved economy means more revenue, newspapers must still eliminate their high fixed costs such as the expenses of running print operations. Stop the presses.

For coverage of Nielsen's report, click here for The Wall Street Journal's analysis.