> But nationwide, there's been no mass replacement of local newspapers. Non-profit online sites are largely based in major metro areas.

Is this really true? I've heard of at least a couple of non-profit newspapers opening in small towns including the one I'm from, and I don't really pay that close of attention to this stuff. For enterprising journalists there are a lot of people willing to pay/donate to these causes. Optimistically, the funding can move from ad/subscription more to donations/grants and the local reporting can continue.