For a breathless moment yesterday, it seemed like Rupert Murdoch had revived the fortunes of the beleaguered newspaper business.

After years of slumping stock prices, layoffs, bureau closings and general malaise, finally, someone had seen value in what journalists do. The minute CNBC reported Murdoch's $5 billion play for Dow Jones, and otherwise depressed industry jolted with a renewed vigor at the prospects for a bidding war over the prized Wall Street Journal.

While the unionized newsroom of the Wall Street Journal recoiled at the prospect of becoming the newest Murdochian outpost, newspaper publishers cheered at least as their own stocks jumped on the news.

Yesterday, the New York Times Co. soared some 6 percent, the Washington Post Co. was up 2.7 percent, and McClatchy Co. climbed 4.2 percent.

Murdoch's bid seemed to validate the business and its economic value.

But hope for a long-term revival is misplaced. For years now, as the profusion of internet content upended the print newspaper's traditional business model, the newspaper industry's default defense went something like this:

"In this age of media fragmentation, consumers will increasingly look to trusted brands to cut through the clutter and provide accurate information."

Newspapers' big bet--and it still is an unproven bet--is that consumers will place a higher value on branded content from online newspapers and advertisers will follow them there.

Forget blogs and aggregators. Consumers will seek the web editions of the big trusted dailies. Or so publishers say hoping to counter sagging revenues and declining circulation.

Murdoch's $60-per-share bid for Dow Jones lent credence to this trope. But, sadly, the heady bounce newspaper stocks received following News Corp.'s play for Dow Jones will remain short lived.

The fact is, the fundamentals for the industry haven't budged. In March, average daily circulation fell 2.1 percent for the 745 papers that reported audited figures (the New York Times dropped nearly 2 percent, while the Los Angeles Times saw circulation slide 4.2 percent). Profits are down as advertisers continue to abandon print for the web. The vitals aren't good.

And, despite the fact that newspaper stocks jumped at the prospect of New Corp.'s acquisition, the reality is, the Wall Street Journal is a very different media property than the New York Times and other consumer papers.

Indeed, the Journal's DNA is closer to a trade publication. It has a defined readership. Unlike other papers, the Journal's circulation is actually increasing.

To date, Dow Jones is the only publisher (outside of the porn business) that has been able to successfully get readers to pay for online content. And, its highly affluent corporate readers view information as an indispensable cost of doing business.

The not-so-dirty secret is that many Journal readers receive their papers from their employers as a corporate perk. When the Journal launched its Saturday addition in 2005, for example, more than half its readers had to switch delivery from their office to home addresses. Ask these readers to pay out-of-pocket for the Journal, and its circulation picture would be very different.

No matter how this all plays out, for all the hope, revulsion and hype accompanying Murdoch's overture towards Dow Jones, the inexorable challenges facing newspapers remain.

by Gabriel Sherman