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I agree that major papers will be marginalized into online forms, where they will be much more effective overall, and much less wasteful.
Local papers may continue to be paper-based a bit longer, at least until they can figure out a revenue stream that allows them to go online (though you'd think the money they'd save from printing and distribution costs should help their bottom line a lot). At least local papers tend to be smaller, so they do not use (i.e. waste) as much paper as major periodicals.
I do think that ultimately all the papers, and all but the most high-quality printed magazines, will go online for economy of scale and wider, easier distribution reasons. Remember, the wider your distribution (potentially worldwide when online), the more you can get for advertising, so many of those periodicals stand to benefit from the wider distribution that online will provide.
This will highly depend on the quality and ease of use of periodical reading devices available in the future... color will be a great attraction for many users, especially kids, and SFX like animated graphics will help to win others.
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