The New York media landscape is about to get a major makeover, and the likely loser will be Mort Zuckerman, owner of the New York Daily News.

The winner: Rupert Murdoch, his longtime arch rival as owner of the scrappier, down-market New York Post, and more recently owner of the far more prestigious Wall Street Journal.

Murdoch is about to close a deal in which he would gain control of Newsday, the Long Island daily that's now part of Tribune company under real estate mogul Sam Zell.

The sale of Newsday had been rumored for months, and two top contenders were Murdoch and Zuckerman, but better than even money was on Murdoch, who apparently has agreed to pay $580 million, well above the going rate for newspapers in today's market.

The deal gives Murdoch a huge advantage over Zuckerman, and on several levels.

It gives Murdoch a much larger share of the New York newspaper market, with his reach extending from midtown Manhattan to the very eastern end of Long Island. He also gains control of a paper that while struggling against declining circulation and advertising faces far less competition on its home turf. The nation's 10th-largest daily, Newsday has long dominated Long Island.

But more significantly, Murdoch gains huge cost advantages over Zuckerman. He will see savings on newsprint buying for three papers rather than one, and he'll also be able to save on distribution costs while balancing off operating losses at the Post with the still-profitable Newsday.

Murdoch will gain a huge advantage in being able combine print ad sales of the Post and Newsday, offering advertisers the opportunity to reach just about every demographic in its much-larger circulation area.

The combined operation will offer advertisers significant and cost-effective reach in the greater New York market, says Henry Scott of New York’s Gansevoort Media.

“Newsday's own effort to create a New York City edition, and achieve the same reach, failed after an investment of $100 million or more to launch a new newspaper,” says Scott, referring to New York Newsday.

“Murdoch isn't taking that risk. He's buying into a going concern with positive cash flow. This deal eliminates any reason I can see for an advertiser to need to buy the New York Daily News.”

Just how and whether The Wall Street Journal would fit into such an equation is hard to say, but at this point analysts don't see a fit.

According to various reports, Tribune and News Corp. have informally agreed on key aspects of the Newsday sale, including the price structure and governance. Neither News Corp. nor Tribune replied to Media Life requests for comment.

Under the terms being reported, Newsday would be part of a joint venture with the Post as well as various non-newspaper assets owned by News Corp. Tribune would retain a stake of less than 5 percent.

The sale would be the first of Tribune properties since the company was taken over by Zell in December.

After much speculation, Zell confirmed in a conference call last week that Newsday was on the block and bids were being considered. The sale is necessary to reduce Tribune’s $12.8 billion debt load. Zell may be seeking to sell off other flagship properties, including the Los Angeles Times, industry watchers speculate, despite a promise last year not to sell off pieces of the company.

It was also in December that Murdoch took control of the Wall Street Journal after purchasing Dow Jones for $5.16 billion.

One possible hitch in the Newsday deal could be in the form of federal regulators concerned about antitrust issues, since Murdoch already owns two newspapers and two television stations in the New York market. However, industry analysts say that the current downturn in the newspaper business may make antitrust concerns a non-issue.

Steve Greenberger, executive vice president and media director at SLG Advertising in Greenwich, Conn., told Media Life last month that The Post in the evening and Newsday in the morning would make for an interesting synergy.

“The Post, because it’s been a predominantly evening paper, could be complemented to those who live out on Long Island,” he said. But Greenberger added, “I’m not sure if people are inclined to buy two newspapers a day, however, especially today.”