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Gannett, McClatchy, Tribune Forming Joint Ad Sales Site

In the beleaguered newspaper industry, survival may depend on seizing what online opportunities exist. That seems to be why some newspaper companies have joined hands with Google for its print advertising program and with Yahoo for an ad and content partnership.

Now, the nation’s three largest newspaper publishers - Gannett, McClatchy and Tribune - have pulled together to offer advertisers one-stop shopping for display ads on internet sites, writes The Wall Street Journal. The site will allow large advertisers such as car makers and phone companies - who don’t want to waste time negotiating ad deals with several newspapers - to use a single point of purchase to reach a nationwide audience.

The companies are expected to contribute 10 percent of their online advertising space to the joint effort, called Open Network, according to people familiar with the situation.

For newspapers to attract national advertisers on the local level has long been a challenge because of price: papers can increase price points for local advertisers who don’t have other means of reaching a local audience - but national advertisers find it easier and cheaper to engage in television advertising or magazine advertising. They can reach a national audience without having to negotiate with dozens of local papers.
Online, national advertisers can, even more easily, run display or banner ads across a network or with a portal.

Newspapers have yet to truly band together to coordinate online sales, in part because individual papers did not want to give up control of their relationships with advertisers (one reason some critics believe newspapers are running a risk by banding together with Google) and because they did not want to standardize ad sizes.

Lincoln Millstein, senior vice president at Hearst Newspapers, hopes the three papers will decide to join the Yahoo consortium rather than creating a new network, but Gannett has already told investors that the trio of papers plan to build “the largest network of newspaper-developed local sites for any advertiser to reach local consumers.”

Other members will be welcome to join the network if they are willing to abide by ad pricing and placement rules.

Plans are still in negotiation stages and could still fall through, according to the article.