The backers of a new daily newspaper aimed at the Dublin market are seeking to raise €3 million to fund its introduction next January, write Karlin Lillington and Arthur Beesley.

The individuals behind the Dublin Daily News include the founding editor of Ireland on Sunday, Mr Liam Hayes, and the former chairman of that paper, Mr Paschal Taggart. Figures linked to the Online.ie website owned by DigiServe are also involved, including the entrepreneur Mr Colm Grealy, who will be chief executive of the paper.

It is understood that the backers of the project have approached banks and venture capitalists with a business plan. The publication will be positioned between the Irish Independent and the Star.

It is believed likely to compete with the Evening Herald in the following classified advertisement categories: property for sale and rent, personals, motors and recruitment.

The backers have claimed that no newspaper targets the Dublin market exclusively. Their plan states: "At first glance the Irish newspaper market appears congested. However, a significant gap exists for a mid-market, metropolitan tabloid to reflect the city that Dublin has become in the last decade."

It adds: "The readership will be a young, brand-conscious group of people - biased towards the female segment - with high disposable incomes. As a lifestyle accessory, this will be the product that people will be proud to be seen reading and carrying. It will be branded as far more than a newspaper."

The company is believed to have approached the Meath Chronicle to print the paper. Financial projections in the business plan show that the newspaper's launch price will be €1, rising to €1.50 by its fifth year.

It aims to generate a circulation of 25,000 in the first year, rising to 50,000 by year five. While the backers aim to spend €2 million promoting the title each year, the plan states that they aim to reach the break-even point within two years.

The plan shows an operating loss of €2.12 million in the first year and an operating loss of €399,000 in the second year. It projects €958,000 in advertising revenues in the first year, rising to €1.49 million in the second, €1.93 million in the third, and €2.32 million in the fourth. Advertising revenue in year five is put at €2.81 million.

The plan states: "The Dublin Daily is positioned for a January 2003 launch. Longer commuting times, darker evenings and colder weather tend to optimise newspaper sales. The Dublin Daily's bright, breezy format will be particularly well received at this time and will help lift the post-Christmas blues."

The backers plan a low-cost news operation, with an emphasis on Dublin news stories, entertainment and sports. They state: "As in many other newspapers, national and international news will be largely syndicated from online and traditional news agencies".

The plan adds: "There is a very active market for acquisitions of Irish regional media, valuing them at between 12 and 15 times profit."

Information about Dublin Daily News Ltd in the Companies Office is very scant, with little more than articles of association lodged to date. The firm was incorporated on September 11th, 2002.

Online.ie launched in 2000 using syndicated content, but intending to build up a dedicated news staff that could break news nationally before the print publications. It would then function as a daily media outlet in its own right.

But the website now relies almost entirely on news "feeds" from print sources such as Business & Finance magazine and the Irish Examiner, and a range of small online companies.

According to the business plan, Dublin Daily will source its news "largely" from DigiServe's existing syndicated print and online media, with a small group of freelance writers and columnists contributing original writing.

If it sources news from online media companies for the print paper, the Dublin Daily would reverse the model of Digiserve's online companies, which rely predominantly on print sources for their online content.

It would also be competing for its audience with its online suppliers of news. The plan states that the publication would also take "page-ready" content from suppliers such as Reuters and the Press Association.