While converting to a not-for-profit won't improve the financials, it would allow the paper to ask for philanthropic support, not unlike public radio or television stations. This isn't meant to be a solution to the industry woes but instead a thought that came about after reading that McClatchy (NYSE: MNI - News) was collaborating with the Christian Science Monitor, a not-for-profit, in some of their overseas news bureaus. I hadn't realized there were any not-for-profit papers. I'm also encouraged by the establishment of ProPublica, a not-for-profit investigative-journalism organization led by former Wall Street Journal managing editor Paul Steiger.
Recently, I had an on-air personality from one of the local PBS radio stations present to my media-management class at Kent State University. Listening to him discuss the support for the station and the support for National Public Radio, I have to believe there's enough support out there for a newspaper. If the goal is to save some of these daily newspapers, perhaps this idea could save a few.
They already are non-profit. Maybe not by choice, but that certainly is the result.