Do smaller news orgs have elusive solution?

Another in a string of conferences on the "Future of News" was held this time in Minneapolis November 16 and yielded what was acknowledged by the summary white paper, and I paraphrase, "We agree there's a problem, the stakes are high and we need to find solution."
This was a predictable conclusion because there was scant representation of rural, community newspapers even though they make up the vast majority of newspapers in this country.
Panelist Ken Doctor found more redeeming value in what he termed the "wankfestapalooza" than I did saying he heard some new answers -- like sharing of resources. However, the discussion is still focusing on "national" or "big city" news organizations.
Let's get to the crux of the problem here:

Journalism is not dead nor are the news organizations that support it. We are going through a very dramatic shift but not anything we haven't seen from earlier times when other technologies caused a disruption to our comfort zone.
News consumption by all news consumers is up, way up, in some cases. So if our main product is news, the market is growing by leaps and bounds. Distribution and revenue models are more of the question. The notion that journalism i.e. news consumption, is dead, is preposterous and ridiculous and not supported by the facts.
I will acknowledge that we effectively lost classifieds and will not be getting them back as they were. We need something different to retrieve some of them and there are models being tried today. (ADDED: However, the losses to the metros were more pronounced chiefly because of both their volume and high rates. The fall of community newspapers was not as far.)
Local ROP advertising (if constructed well) does continue to work for our advertisers especially those in regional hubs. In fact, a recent Yankelovich study found traditional media, especially newspapers, still is the most effective advertising method. However, the economy has forced
businesses to scale back on ALL media.
(ADDED: National advertising has nearly dried up for metros while it chiefly left community newspapers back in the '80s.)
Preprints for all newspapers are the latest battleground at the negotiating table with demands of unprecedented concessions in rates. Besides capitulation, some modifications here include partnership such as Zip2Save which provides advertisers an online alternative with a print component to help in the transition.
However, circulation rate increases - while affecting units - is showing revenue growth because a good chunk of readers apparently aren't shying away from paying more for a product they value. (ADDED: This appears to be holding true for some but not all newspapers depending on region and other factors.)
There seems to be agreement that online revenue will not replace the amount of revenue we now see from traditional sources. However, it will be a strong niche income producer not unlike our other products newspapers are offering such as city magazines or other niche publications.

In other words, the business model is being reshaped as the revenue mix shifts possibly bringing in less from advertisers and more from consumers. The challenge
to newspaper organizations is to ensure we have the right mix that allows for us to engage our communities, give the best results to our advertisers and yet fund the best journalism we can. That first goal is the most important.

Despite the white paper starting out with a quote offered by Jim Hoolihan, CEO of the Blandin Foundation that "Newspapers should aid the community in achieving the dreams of its people," there seemed to be very little mention of how our new models will strengthen our communities.
Instead, as one blogger noted, we are now bumping up against conferences that are saying and finding out the same thing. The problem is the conferences focus on a question -- who will be the king of the hill -- rather than a solution. Isn't it
about time we looked at it from another angle? Can we finally acknowledge that one of the reasons we are not finding solutions is because we are not focusing on the obvious.

First, the consumer -- are we giving them what they want or just what we THINK they should have. We have scant research being done on what consumers want. We have commissioned Minnesota State University-Mankato to undertake such a study and have thrown out the templates newspapers have used for decades instead challenging our researchers to look at it from the perspective of users not providers.
Second, consider the geographic community -- we are spending too much time talking about serving the very specialized audience (audiences on mobile phones, social media, etc.) without acknowledging those platforms have relatively small penetrations in our non-metro communities. Yes, they should be in the mix of communication methods but for now at least they are not predominant.
Third, what do we mean by engagement? In some cases, reporters and editors will tell you they already are engaged. But there is always more engagement possible. For example, we found out differently during a meeting with representatives of our various minority citizens who found us to be less than approachable. We at The Free Press are working to rectify that. But it took a face-to-face meeting to find that out. Are the leaders of the larger organizations willing to reach out at the neighborhood level?

Pew Center research finds respondents are less trusting of us. Is it because we continue to stand aloof rather than amid?
As the news organizations evolve, we cannot continue to ignore significant segments of our community. And we must acknowledge they use various methods of communication. We need to engage them in a very personal level and creating "communities" through social media will not get this done.
And that last point is something community newspapers always found to be their strength. Community involvement, engagement and helping set the agenda for development and progress. No one medium can do this anymore.

I offer this as one possible mutation: Community news organizations as the heir apparents to the larger organizations. We KNOW local. Could one succession be that smaller "neighborhood" newspapers print & online emerge under one umbrella utilizing all aspects of online & mobile portals for further engagement? Maybe even partnerships with those once considered competitors.
For instance, we are working on shared content agreement with Minnesota Public Radio that gives them reach and enriches our offerings.
This may mean smaller newsrooms of specialized reporters and using professional editors to work with able neighborhood representatives serving as "citizen journalists." Online would be used for both engagement and enrichment of story development with the communities we serve.
More than likely this development will happen with entrepreneurs or present community newspaper publishers will to take the risk.
The likelihood of larger organizations morphing into this new model is slim. They are loathe to breaking themselves up and the newspaper guild would be hard pressed to accept reduced benefits and wages. With both backed into this corner, some of them are more open to government bailouts while community newspapers are foregoing the tin cup.

Finally, future conferences need to be less about jockeying for power and more about finding solutions that include all news providers not a select few and all media not just the emerging digital media platforms.