The largest study of country newspapers ever undertaken in Australia is hoping to develop sustainable models that can help the declining regional media landscape survive into the future.

Key points: Local newspapers are facing their biggest challenge as traditional business models falter in the digital age

Local newspapers are facing their biggest challenge as traditional business models falter in the digital age Deakin University will partner Country Press Australia in a three-year study to seek a solution

Deakin University will partner Country Press Australia in a three-year study to seek a solution Fewer journalists are covering important issues, including those arising out of local government

The three-year project, conducted by Deakin University in partnership with Country Press Australia, will analyse the challenges local newspapers face and explore innovative ways to sustain the industry.

The study will also inform communications policy and will add to the work the Federal Government is doing to help regional mastheads transition to digital platforms.

Deakin University project leader Associate Professor Kristy Hess said the study would focus on small regional newspapers, before broadening out to include other news media.

"Local newspapers have been one of the most reliable sources of local news, so we feel it's important to start an assessment there," Dr Hess said.

"We know local news has been facing major difficulties here in Australia, but also oversees, and yet we really require some more robust evidence and analysis of what's going on.

"We'll be engaging quite intensively with proprietors and editors across Australia to look at what's working, and what can be successfully integrated into a more innovative media practice and policy."

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 4 minutes 32 seconds 4 m 32 s 'Who will tell our stories?' Media decline hits regions hard ( ABC News )

Study 'desperately needed'

Staff at four regional WIN News bureaus were told they wouldn't have jobs last month because of competition in the market and it's still unclear what the sale of more than 160 regional newspapers to former Domain CEO Antony Catalano will mean for its reporters.

McPherson Media Group (MMG) publishes 13 regional mastheads across Victoria and New South Wales, Executive Chairman Ross McPherson said a study into local press was desperately needed.

"Globally the model for supporting local news is under considerable pressure," Mr McPherson said.

"There are probably half the number of reporters operating globally than there were ten years ago.

Ross McPherson says the bleeding continues in regional newspapers. ( McPherson Media Group )

"It has been a massive change and I think that trend is continuing.

"The bleeding hasn't stopped."

Mr McPherson said part of the challenge was convincing people that news was worth paying for.

"That has become a challenge in recent years with things like apple news because people have become used to expecting news to be free," he said.

"If we can't find a sustainable model long term for people to realise that without independent reporting the available sources of news are just going to diminish."

'Alarming' decline in regional news

Last month, a Public Interest Journalism Initiative (PIJI) report found there was a concerning drop in regional journalists reporting on local government.

The report surveyed media managers employed by local councils, finding almost half of respondents from regional and rural areas noted "some decline" or "significant decline" in local news coverage over the past five years.

Associate Professor Margaret Simons said fewer journalists covering local government meant communities were less informed, leading to public opinion being more easily manipulated.

"There is a whole level of government in our democracy that is not being scrutinized or reported," Professor Simons said.

The report confirmed that the broken traditional media model has led to advertising dollars going online to search engines and other platforms, rather than traditional media outlets.

Shrinking newsrooms meant fewer journalists covering local news for local communities.

"Given that numerous pieces of research worldwide indicate a close relationship between journalism and the broader civic health of communities, this decline has serious implications for the agency, power and health of citizens in Australia's regions," Professor Simons said.

Government innovation fund

Last year, the Federal Government committed more than $45 million to help regional and small publishers adapt to the challenges facing the news industry by establishing the Small and Regional Publishers Innovation Fund (the Innovation Fund).

The three-year competitive grants program was designed to support regional and small publishers' transition to and compete more successfully in the evolving media environment.

The Country Press-Deakin study aims to assess the effectiveness of that package and whether it's hitting the right target.

"We do know that initially some of the small publishers, the ones that are servicing towns with populations of less than 5,000 and not significant turnover missed out on funding in round one," Dr Hess said.

MMG secured funding in the first round of the Innovation Fund grants to create digital efficiencies through new technology solutions.

"The Federal Government funding has been particularly welcome because one of the challenges of moving to reader revenue is having the technology platforms to sustain that.

"Up until recently they have been relatively expensive.

"For a small newspaper to be able to find upwards of a million dollars to fund its own platform for harvesting reader revenue, and providing a full digital service was just not possible."