The Dallas Morning News currently has a Monday through Saturday paid subscription rate of 265,000; the Sunday edition has 290,000 paid subscribers; and the average subscriber pays $27 a month. Moroney’s problem is this: He needs to run a newsroom with a yearly budget of $35 million. This operating budget does not include the marketing, sales, printing, or distribution of the paper, just its core competency: news gathering.

Assuming traditional newspapers go the way of the eight-track tape, if an e-reader like the Kindle and the Dallas Morning News offered a $12.95-per-month subscription with a 50-50 revenue split between the two companies, Moroney calculated he would need 449,000 e-reader subscribers just to keep the newsroom running: “I’ve cut out newsprint, ink, and distribution, and if I don’t have ads being carried on the e-reader and that’s the only revenue stream I have, then I could not run the business at the level it is now. I could not support it for $6.50 per month per subscriber.”

Then there’s the question of advertising, historically the main source of revenue for newspapers. The Kindle e-reader does not support or display advertising with its news subscriptions. “It’s great to cut out news print and distribution,” Moroney says. “It’s great to cut out those expenses, but I need revenue to support our core competency: a fully staffed newsroom.”

Unlike the Internet, and specifically the Web browser that allowed newspaper content to be posted onto a relatively free medium, e-readers were developed to replace both traditional printing and distribution channels for content creators, whether they are book, magazine, or newspaper publishers. But that said, at this stage at least, e-reader developers are not keen to take up any of the responsibilities of a traditional publisher.

“I don’t think it’s our goal to replace the publisher,” says Daren Benzi, vice president of business development for Plastic Logic, developers of the Que e-reader (pronounced “Q”). “We look at ourselves as someone who can partner with publishers. We’re very much aligned with our partners, and we know what’s important to them. We are talking and thinking about advertising.”

Even Rupert Murdoch, following on the heels of his announcement that he might de-index the Wall Street Journal from Google, believes that e-readers might be the future for newspapers, but only if a sustainable advertising and subscription model exists: “People understand that it’s perfectly fair that they are going to pay for (news),” Murdoch said in an interview on the Fox Business channel.

“What I would like to be able to do is get a better revenue split,” says Moroney. “My content is more valuable than the kind of splits that are out there.”