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Yahoo Consortium, Newspaper Titans in Ad Alliance

When in trouble, find strength in numbers.

quadrantONE, the coalition of newspapers formed last month to pool online advertising resources, has partnered with the members of Yahoo's (NASDAQ: YHOO) Newspaper Consortium.

The move doubles the size of quadrantONE, which was created to give newspapers a better chance at competing with the Web portals for ad dollars.

The problem facing newspapers is an elemental one: if a major advertiser such as Toyota wanted to promote the Prius to a national audience using the Web, it would make more sense to go to a single-placement ad network to reach a major portal than to broker individual deals with the local newspapers in every market it was trying to reach.

With each of the papers pledging to contribute a certain amount of ad space on their sites, the joint venture aimed to entice national brands with the promise of reaching highly localized audiences throughout the country in a single campaign.

With subscription rates falling as readers migrate online, the newspaper industry has been struggling to develop new business models to revive its fortunes.

quadrantONE formed as a coalition of four major media companies: Tribune Company, Hearst Corporation, New York Times Co. and Gannett. Linking up with the Newspaper Consortium now fills in some of the major holes.

The addition of major newspaper publishers such as E.W. Scripps and the McClatchy Company brings 138 consortium sites into the fold. quadrantONE now counts more than 250 sites in its network, which it said represents more than 25 percent of all the daily newspapers in the country. In future integrations, more of the consortium's 425 newspaper sites might pool their inventories with quadrantONE.

"By aggregating the online audiences of the consortium's participating media companies, we expand our reach significantly -- and enable large national advertisers to reach tens of millions of additional unique visitors in the country's top markets," Dana Hayes, interim CEO of quadrantONE, said in a statement.

Yahoo formed the consortium with goal of expanding its ad-serving network. It began with funneling out HotJobs employment listings to the newspapers' sites, but has expanded into display advertising and other formats.

Today's announcement does not alter Yahoo's deal with the publishers. Yahoo will continue to place ads on consortium members' sites, but they will set aside another portion of their inventory for use through quadrantONE.