The article sharply contrasts with a recent study by the Deutsche Bank, which suggested the Yahoo deal would lead to a surge in revenue for newspapers.

The first phase of the Yahoo-newspaper agreement consisted in linking classified ads between the newspaper sites and Yahoo’s HotJobs, which enables Yahoo to tap into the local ad market, and papers to plug into the national ad market.

"We pick up eyeballs. We gain traffic," said Dan Hayes, spokesman for Lee Enterprises Inc, one of the 19 paper publishers involved in the partnership. "Yahoo had a beneficial impact in there."

Other major US publishers, such as Gannett and Tribune co., didn’t enter the agreement, to develop a display ad network of their own.

Among their concerns were the potential loss of control of newspapers when entering the deal. Gannett worries “that publishers will cede too much content to Yahoo, leaving readers with little reason to visit its many local newspaper sites,” reported Reuters.

Other media commentators point to the fact that Yahoo is trailing behind Google in terms of technology, and might not be the best partner.

"The fact is, they haven't built the Yahoo server yet," said Alan Mutter, Newsosoar blog. "Yahoo might build something even better, but the risk is that they don't."

Source: Reuters - paidcontent.org