What are the potential benefits of allowing newspaper ownership to be concentrated in the hands of a small group?
The whole point of having a "Fourth Estate", or media that is independent of the government, is so that it can serve as a democracy watchdog. This idea is meaningless if, instead of being controlled by the government, they are controlled by ratings and profits. What is news is not always profitable and what is profitable is not always news. The more concentrated the media becomes, the less value it has in protecting our democracy.
Most people say that having only a few people owning newspapers is bad for democracy because then only a few voices are heard. But you can argue that it is actually good for newspaper ownership to be concentrated.
The reason for this is economic. There is an idea called "economy of scale" which means that firms can produce things more cheaply if they are big. If large newspaper firms could create economies of scale, the price of producing a newspaper might go down. If the price of producing newspapers went down, it would be more possible for newspapers (which are going broke) to stay in business. That way, concentrated ownership might actually allow more newspapers to stay in business.
In general, it is not a good idea to allow newspaper ownership to be concentrated in the hands of a small group. The benefit of economy of scale, as pointed out in the post above, is quite valid. But, this benefit accrues only to the owners of the newspapers. The interests of consumers of newspaper, that is the common people, are actually hurt in spite of economy of scale. The newspapers will be able to charge consumers in spite of lower costs enjoyed buy them. As a matter, it is now widely recognized that the monopolies are against the interest of people. For this reason many democratic countries, including the USA and India, have laws to control monopolistic power of companies.
The negative effect of concentration of newspaper business, in addition to the negative economic impact on the people, will also tend to give too much political power in the hands of newspaper owners. It will enable them to restrict information and conflicting views on political and social matters presented to people. They may follow such practice to promote their own view and beliefs. Worst they might promote interests selected political parties who pay then to do so.
The ability of money power to influence the behavior of people subtly through advertisement is well known. Concentration of ownership of newspaper is likely to extend such manipulation of people through news items also. The newspapers may print news items designed to support and promote interest of companies that pay them money to do so.