Newspapers have been retrenching with the growth of the Internet, the rise of online classifieds, and the decline of print readers and advertisers. Reaching the audience online may be the way these dinosaurs of media survive the meteor strike of the Internet.

It appears a couple of the bigger ones managed to find leafy trees to sate their appetites. ClickZ said the LA Times and the Seattle Times turned their attentions online to serving the local audience better.

Their payoff arrived in the millions. The LA Times claimed it will hit $25 million in online revenue this year. Eventually, the figure will be 20 percent of the paper’s cash flow by 2011, ClickZ said:

“We’re trying to create the best targeting machine to the Los Angeles DMA,” said Barrett, speaking at this week’s Kelsey Group local media conference in Seattle. Recognizing LA and California are identified with certain topics such as environmentalism, Hollywood, car culture, and immigration, they are central to his content redevelopment scheme. That entails a locally-focused travel section redesign and a behind-the-scenes film site set to launch soon called HollywoodBacklot.com.

The Seattle Times’ effort hinges on a local city and community guide called NWSource. Unlike much of the rest of the country, the real estate crisis has yet to hit Seattle. As a result, Seattle Times VP New Media, Patricia Lee Smith, witnessed ads sell out for neighborhood pages, with local builders buying them up.

The reward comes from CPM rates three times higher than for the websites of the Seattle Times and the Seattle Post-Intelligencer, she said in the report.