Does the free newspaper model stand up today.

Do read Philip Stone's article in Follow the media this morning.

Philip examines the business model of the free newspaper Metro and questions whether the revenue streams stack up in the current economic climate?

As economies around the world suffer from high oil prices, the credit squeeze, and in the case of newspapers higher newsprint costs, the logical question is whether free newspapers can really make money in an environment where the advertising ranks are thinning out and ad rates, already pretty much rock-bottom, have to sink lower to attract the free paper advertiser? Can consolidation that creates bigger advertising package incentive deals with paid-for newspapers save the day?

Reflecting that it is 13 years since the Metro first launched in Stockholm,Stone says today that

According to Dr. Piet Bakker, perhaps the foremost expert on global free newspapers, most publishers probably planned at launch that their free newspapers would be profitable in three years, but they now seem resigned that it will take far longer, perhaps five years or more. Can they stand for that kind of long-term expense? He believes that some 75 free newspapers have already closed.