Yahoo's newspaper consortium threatened by newspaper consortium

Yahoo's online advertising partnership with newspapers is facing a new threat — from the newspapers themselves. Five of the nation's largest newspaper companies — Gannett, Tribune, Hearst, MediaNews, and Cox Newspapers — are teaming to create a one-stop shop for online advertising. A single sales force will be able to sell ads across all major markets. Hearst, MediaNews, and Cox remain members of the Yahoo consortium, but the new partnership is foreboding, especially for Yahoo president Sue Decker, who helped engineer the deal and keeps holding it up as a totem of Yahoo's new partnership strategy.

But the Yahoo deal's momentum has already slowed, and despite Yahoo's stated desire to woo newspapers, it has done little to advance the program's underlying technology. The newspapers are obviously looking out for their own interests — and may well serve themselves better.

Then again, the newspapers have tried to cooperate online before and failed. The New Century Network, a similar effort, quickly collapsed in the heyday of the first bubble because of infighting. The future may not bode well for Yahoo's newspaper consortium, but the history of newspaper networks is not encouraging, either. Of course, both alliances could fail if newspaper readership continues to erode.