Buffett's deal of choice
Anybody watching newspaper stocks -- which have seen a mid-teen percent valuation jump in the past year -- will agree Olin is probably right. The upside of small- to medium-sized print outlets has not been lost on America's best investors. None other than Warren Buffett began gobbling up smaller print news outlets last year. The flashiest was a $142 million purchase of 63 papers from Richmond, Va.-based Media General ( MEG).

In fact, this sector is so successful that analysts are codifying an investing approach. Want to buy a local print cash cow? Check out a blog post by Peter Beller and Sarah Erickson, content director and content manager respectively at Los Angeles online content exchange Ebyline, called, Uncovering the Buffet Equation for Newspaper Survivability.

The secrets to media success these days? Never mind talk at media giants such as Gannett ( GCI) scoring this or that paid-content play online. What makes real money these days is keeping it small, keeping it local, ignoring the Web and not sweating falling circulation.

If investors want to see what woes await if this advice is ignored, just drive north on Route 1 to Thomaston, Maine. There Courier Publications -- the publishers of The Courier Gazette, The Camden Herald and other local Maine papers -- was bought in 2008 by a Web entrepreneur named Richard Anderson. Armed with an $885,000 Knight Foundation grant, Anderson changed the focus of these outlets from print to Web, gave most of his content away online and deployed new digital production software. But -- like many other media outlets lost in the Web wilderness -- costs rose, revenues fell and by March 2012 Anderson ceased operations.

Even still, local news printed on paper held its value: A free-circ paper publisher named Reade Brower bought the outstanding assets, reports show, and a print-focused Courier Gazette and Camden Herald began publishing yet again.

No new media answer
Even more stunning for investors to consider is how new-media's leading lights are almost irrelevant in the discussion on how to replicate the success of The Lincoln County News. Last month, I had the chance to directly question Tim Armstrong, CEO of AOL ( AOL), about the success of papers such as the News compared with struggling new-media local options -- specifically Armstrong's Patch.

"That type of success you see in smaller papers is what we hope to replicate," he told me. When I pressed him and mentioned the grim results for Patch, Armstrong said he hopes it will be profitable by the end of 2014.

Here's the kicker: Maybe new-media options such as Patch work out. And maybe they won't. The fact is, it probably doesn't matter. The Lincoln County News will probably be around for another 138 years, Web or no Web. That means, for investors looking for rare upside in today's confused information economy, kicking it old-school and seeking out news, printed on paper for a targeted market turns out to be as good a bet as you can take.

"We are not going anywhere," Olin told me.
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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