Newspaper publisher Tronc Inc. (NASDAQ: TRNC) bought the New York Daily News for $1 plus the assumption of its pension and other liabilities. It is bet on the New York City market. The New York Daily News has lost money for a number of years, but Tronc now has papers in Los Angeles, Chicago and New York City, the nation’s three largest markets.

Tronc may be able to save money by combining some functions with the Harford Courant, which it also owns. If those savings are in the millions of dollars, Tronc should be able to cut Daily News losses sharply.

Tronc will also enhance its national digital footprint. Its LATimes.com is one of the largest newspaper websites in the country. According to Simple Web, its audience is 65 million visits a month. The same research firm puts the number for NYDailyNews.com at 40 million. In combination with other Tronc papers, its total audience among all its news sites brings it closer to WashingtonPost.com, one of the largest newspaper sites in the country.

Tronc will be able to sell both national and online advertising across a network that includes the three large cities. It also will be able to syndicate content that includes both video and articles across its papers. Tronc has set a major initiative to increase its video content. Some of this almost certainly will end up in NYDailynews.com.

The deal also undermines chance that Gannett Co. Inc. (NYSE: GCI) will take another run at Tronc. Gannett tried to buy Tronc last year. Tronc has made a large investment in the New York Daily News and added online industry veteran Ross Levinsohn as CEO of the Los Angeles Times. It is unlikely Tronc Chairman Michael Ferro, who on a practical basis controls Tronc, will abandon what are clearly plans to build a national newspaper empire.

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