The North American Free Daily Newspaper Association says free dallies are growing in the U.S. and points out that Mt. Airy (!) and Fayetteville are each getting one. Makes sense.

Then the groups says stuff that does not make so much sense:

“Launches of free dailies in mass-transit cities such as New York, Boston, Washington, and Chicago have gotten the most attention from reporters who cover the media,” Henry E. Scott, interim director of the Free Daily Newspaper Association and former group publisher of Metro International, said in a statement. “But our study shows that nearly a quarter of North America’s free dailies are published in small towns and have circulations of 10,000 or less.”

The study found that 16 free dailies have a distribution of 100,001 or more copies; 11 have circulations ranging from 50,001 to 100,000; 19 have circulations ranging from 10,001 to 50,000; and 14 have circulations of up to 10,000.

Back up. The key is distribution. Transit stations give you a spot for your paper boxes, true. But there is nothing unique about that. In fact, provided you can get access to the buildings, inside racks and stands can put your product where people can get it, protect it from the elements, and not cost as much.

The key factor in an alt-daily, it would seem, would be the market itself — is it well served by existing mainstream daily offerings? Or is there some niche to be filled? If there is, advertisers will pay for that segment and distribution just becomes a matter of executing a plan.

Bonus Observation: Speaking of a mainstream daily, McClatchy is trading just off a new 52-week low. More troubling for the sector are indications that traders expect more mergers or takeovers in the newspaper world.

I still think the current McClatchy footprint in the Carolinas makes too much sense a business unit to ever be split up, but whether that is part of smaller, leaner McClatchy or part of entirely new entity remains to be seen. One thing is certain, as real estate starts to slow down, so will ad revenue from it. And to the extent consumers need real estate equity to fund big ticket items, watch how that impacts ads for cars and consumer electronics, two mammoth sectors for our Uptown paper of record.