I’m not sure how much J.P. Morgan likes their brokerage research reports making their way out into the world through document-sharing sites such as Scribd, but the firm’s investment overview for 2009 — entitled “Nothing But Net” — is available (for now) through that service, and it has some sobering things to say about the newspaper industry. This isn’t news to anyone who has been following the business of late, but seeing it described so bluntly is still a bit of a shock. Here’s the important chunk:

“In our opinion, newspapers face a significant number of headwinds that will likely contribute to this decline. First, we believe consumer news consumption behavior is changing.

Magazines and newspapers usually have a significant lag time between the news occurrence and its publication, as the process of writing, printing, and distribution is complex. Therefore, instead of reading newspapers, consumers are becoming more dependent on the Internet for breaking news. Secondly, we think newspapers have failed to manage their cost structure. In our view, they try to be the source for all news, and we think this model is unsustainable.

We think recent layoffs will hinder newspapers from broadly covering all news and will thus make them even more irrelevant to the hyper-local or vertical-specific blogs and postings on the Internet. Instead, we think newspapers need to allocate more resources to investigative journalism. This would enable newspaper companies to provide exclusive content and more in-depth opinions that could be difficult to glean from citizen journalists.

Finally, blogs have existed long enough that they are becoming mainstream, with some bloggers making their living off the blogs. As a result, we think some bloggers and publications have become as trusted a news source and opinion provider as traditional media. Thus, we think that when the economy recovers, newspaper dollar losses will go to the Internet.”

All in all, not a bad analysis, I think.