The AP’s getting some backlash from newspapers, who technically own the syndicate, because links to AP stories drive a lot of traffic to their sites (the same papers whose print ad revenue is plummeting). If bloggers boycott AP, as many say they are planning to do, it’ll threaten to cut papers who post AP stories out of the conversation economy.

At the same time, some have suggested that the boycott may benefit smaller papers, as people begin linking to the local papers covering a story, rather than their wire service counterpart.

You’re totally right that the AP doesn’t understand what they’re getting into. (A) What bloggers are doing is definitely fair use, (B) the syndicate is owned by the newspapers, many of whom appear to be pissed about the whole thing, and (C) there are myriad other sources out there, including other wire services, that are just as easily linked to. And if that happens and the AP gets cut out of the conversation economy, their readership, and subsequently their political and market leverage, will plummet.

At any rate, I think the situation comes down to a mix of a few factors:

(1) People still want news from traditional news organizations, not just blogs and prosumer websites.

(2) Pundits frequently predict the fall of particular media prematurely. Radio is still around, though it looks nothing like it did in the 1920s, and nightly newscasts haven’t been killed by cable news. Print newspapers will survive, most likely, but they may change their form substantially. Papers in the UK, for instance, seem to have changed focus somewhat as the conditions of competition changed.

(3) I tend to agree with Roger Alton on at least one point—that if you were riding the metro, sitting in the park, or wandering into a cafe, and print newspapers didn’t exist, that you’d want to invent something like them. Which says something about the commercial viability of the medium, even if it means that the market will be smaller. It may be that mobile Internet and GPS tagging one day become so ubiquitous that printing doesn’t make sense any more, but that day is aways off.

(4) In every country, there are generational and cultural differences in news consumption and production. Young journalists frequently treat new media differently than older journalists. Same with consumers. And which subcultures constitute the production class and buying public in a given capitalist society says a lot about what media are “important” and how long they will remain so—whether a particular medium will, for instance, enjoy a lasting hegemony, or ultimately succumb to (or benefit from) a cohort effect.

(5) The way newspapers are funded is also a big factor here. As print advertising revenues in the US have bottomed out, there have been a number of things going on. Experimental business models like Spot.Us are being given a whirl, and big companies like the Washington Post have changed their major revenue sources. The Washington Post company, for instance, has diversified from the newspaper business. It now owns and gets much, if not most, of its revenue from its subsidiary, Kaplan, Inc—the test preparation company. At the same time it’s buying out a huge portion of its newspaper staff. And other papers, like the Los Angeles Times, are in an even worse bind. How newspapers get funded, and which part of a newspaper organization gets funded (online video, columnists, reporting, foreign bureaus or local ones, etc.) will go a long way toward deciding how they prioritize the print portion of their business. And that funding model, at the moment, is in major flux as we see widely divergent financial experiments from paper to paper, let alone from country to country. So it’s kind of hard to do any comparisons just yet.

I know I had other thoughts, as well, but they escape me at the moment, and this is already an über-long comment. If you’re following this stuff, though, I’ve been updating a new-media-and-journalism RSS feed that collects posts from around 30 journo blogs on topics like this one. They’re not necessarily the end-authorities on the subject, of course, but I’ve found a lot of interesting commentary there.