The imminent death of the New York Times was greatly exaggerated:

Second-quarter results, released Thursday, showed the Times Co.'s advertising revenue finally stopped falling as a 21 percent jump in digital ad sales canceled a 6 percent decline in print. Overall revenue grew about 1 percent because of subscription and newsstand price increases at the flagship newspaper and The Boston Globe, one of 16 other dailies the company owns.

This is good news, but it's not sufficient news. Circulation revenue and ad revenue at the Times are nearly equal, as circulation inched above advertising for the first time in the Times' history last year. Next year, the FT expects content revenue -- "cover price rises, online charging and corporate clients" -- to eclipse ad revenue, as well. The calculus of newspaper financing is changing.

I wonder how this impacts the Times' strategy to put up a paywall in early 2011 to take money from readers who click around the site. If ad revenue from a no-paywall strategy continues to grow, the newspaper might be more nervous about scaring away readers who are already paying "with their eyeballs."

Eventually, something has to give. There is still little indication that online ad dollars will be able to shoulder an international top-notch fleet of reporters, photographers, editors and producers for the decades to come. The long story is that for years, newspapers were subsidized by classifieds and special sections that have all fled for other corners of the Internet. In the future, newspapers might have to be subsidized by something else -- non-profit institutions, benefactors, maybe even federally supported funds.

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