The newspaper business is in trouble. Their trouble is connected to the media fragmentation that I so frequently talk about and the rise of the web as a source for news. It is also connected to having sites like Craig’s List take away classified revenue, which has traditionally been a key pillar to newspaper profitability.

Sam Zell thinks the newspaper business will survive. I am not so sure.

If you are watching The Wire you can see the parallel impact of budget cuts to the police force and budget cuts in the newsroom. In my hometown newspaper, The Baltimore Sun, budget cuts mean that serious news coverage declines, foreign bureaus close and a paper that was once a well-respected part of a thinking man’s daily diet is now just a mere shadow of itself.

David Carr in the New York Times suggests that The Wire is placing too much of the blame for the failures in the newsroom on the management staff that has to make them. He suggests that the show should spend more time looking at the structural issues that are the root cause of the problem.

All of this matters because there is no way for us as a society to address the problems that ail us, if we don’t know what those problems are. If you are a nonprofit working to help low-income Americans or to rebuild the levees in New Orleans or to assist developing countries, you then should care deeply whether and how people get their news.

Today on Techcrunch, Michael Arrington blogs from Davos about a suggestion that government step in to save the whole newspaper industry. The title of his post is “If Real Journalism Fails as a Business, Should Government Step In.” He wrote this because he heard Columbia University President Lee Bollinger mention the idea in a session at the World Economic Forum.

An interesting discussion is on venture capitalist Fred Wilson’s blog today. His post is called Rethinking the Local Paper and he writes about a vision where the local paper is actually an amalgam of “hyperlocal” postings from the moms and dads writing about their neighborhoods. He sees a business model where I assume the big international stuff is covered by the professionals but it’s supplemented by lots of detailed and organized posting from the neighborhood. So the pothole and the PTA meeting are covered by the people it most impacts. This is a level of journalism that local papers could never do and the technology now makes it possible to do it. He points us to two websites working on different aspects of this issue. One is called Outside.In and the other is called Everyblock. Everyblock was actually funded by our very forward thinking friends at the Knight Foundation.

Outside.in takes more blog posts and that kind of info. Everyblock grabs police reports (eek! I don’t want to know!) and things like city permit information — who is building where, etc. Here’s my office neighborhood on Outside.In and on Everyblock.

We will stay tuned to see how all of this plays out. As a nonprofit you need to be thinking not only about describing what it is you do and why it matters, but also in giving people the necessary background they would have once received from their local newspaper.