It sounds a fair enough assumption: One online newspaper reader equals one print newspaper reader. 

Yet when you think about it, the equation is far from true, and it's especially not true in terms of revenue. Online readers generate far less revenue per head than print newspaper readers.

The question is, how much less? The answer is a lot less.

In fact, it takes 20 to 100 online users to bring in the same revenue that one print reader does, according to the media strategists at Borrell Associates, an internet research firm.

That means that for every reader that migrates online from a newspaper’s print edition, the paper must find 20 to 100 additional web site readers just to hold revenue constant.

While the newspaper industry ponders this problem, Gordon Borrell, president of Borrell Associates believes he has the answer.

It comes down to this, in sum. Publishers must stop thinking of the web site as a version of the paper. “It is a completely different medium," says Borrell. "They have to break out of the mold of thinking that their web site is an extension of the paper."

Instead, Borrell argues that publishers must reinvent their sites as separate businesses with the end of growing them dramatically.

Specifically, that means leaving the local news in the printed edition--and out of the web edition. In its place publishers should put up content unique to the site with the sole aim of building traffic and by extension advertising revenue.

There would be little worry of losing readers looking for local news, says Borrell, noting research showing that only 9 percent of surfers read local news online.

“Publishers have to relax. Most people still prefer to get their local news from a paper,” he says. It's for breaking national and world stories that folks turn to the internet in greatest numbers.

What people are really looking for on local newspaper sites is not local news, argues Borrell, but information on local entertainment--what new band is in town--and commerce, the business of buying and selling that in many ways is what's really at the heart of the local newspaper. 

“The interesting thing about newspapers is that half of the people that get a newspaper are getting it for the advertising," he says, and he believes papers have huge online potential in their local display and classified advertising.

“The newspaper is the marketplace for stuff that is on sale. The question is, how do we translate that to the internet?” says Borrell.

The answer, he says, is in organizing that information in a way that makes the web site a must-visit for all manner of information on where to buy what locally, including information on current local sales.

That would drive up site traffic, which is what Borrell believes should be the ultimate aim of any local newspaper site. He likens an internet audience to a TV audience, with a focus on reach and frequency. The bigger the audience, the higher the traffic volume, the more atttractive the site becomes to the largest number of advertisers.

Papers will certrainly have to do something in the face of declining circulations.

Borrell senior analyst Vincent Crosbie recently told a Paris audience at a World Association of Newspapers conference that each print reader of an American newspaper earns the paper between $500 and $900 a year from circulation revenue and advertising.

And while it’s true that online advertising is growing rapidly, with newspapers bringing in $4 billion of the $17 billion U.S. internet advertising revenues, online advertising per reader on newspaper sites lags far behind print editions.

And depending on the pace of readers migrating to reading their news online each year, Crosbie concludes that newspaper must increase site readership by 40 to 1,600 percent a year to keep revenue constant.