The Louisiana newspaper war just got a lot more interesting.

It’s been a poorly kept secret in New Orleans media circles that the Baton Rouge Advocate’s owner-to-be, businessman John Georges, was in discussions with Dan Shea and Peter Kovacs to run the paper for him. Shea and Kovacs are the respected former Times-Picayune managing editors memorably frozen out when Advance Publications rolled out its plan to sack half the paper’s staff, move to a three-day publication schedule, and go all in on clicks with its free website Nola.com. Seeing a market opportunity, The Advocate launched a daily New Orleans edition in September to fill the void.

So it’s surely no coincidence that earlier in the day, NOLA Media Group/Times-Picayune/Nola.com announced that it would return to quasi-daily publication with a new tabloid paper on Mondays, Tuesdays, and Thursdays—the days it no longer prints the Picayune. It’s a measure of the rolling disaster that is Advance Publications’s strategy in New Orleans that its announcement of a return to print—one of the primary reader outrages, along with its seriously reduced newsroom— was greeted with such widespread derision.

Gambit’s Kevin Allman just filets NOLA Media Group in his blog post on the news:

The digitally-focused NOLA Media Group, which cut back print publication of The Times-Picayune to three days a week last year, continued to innovate today by announcing a new plan to print on the days it doesn’t produce a print product, bringing the company up to 7-day-a-week publication, according to an announcement by NOLA Media Group Vice President of Content Jim Amoss.

The report, which is not from The Onion, says the new product, to be called “TPStreet,” will launch this summer in newsboxes around the city and cost 75 cents, just like the daily paper, which it will not be, because it is more innovative than that…

The innovative publication is in response to “a repeated request” from home-delivery subscribers to get a delivered daily paper, but it will not be home delivered, Mathews said:

No mention by Mathews of his market competition, and how it was about to get more serious.

The Advocate’s then-owner David Manship told me in December that the paper already had picked up a circulation of 23,500 in New Orleans. But the new New Orleans bureau lacked the resources to truly compete with the Picayune.

Will The Advocate compete head on with the Picayune? Dan Shea tells me that’s the intention. “We’re going to staff it up to the point where we’re producing a truly local newspaper,” he says.

“They’ve done a great job. David Manship should be lauded and Sarah (Pagones) and all of our colleagues in the bureau. We’re going to provide the resources.”

It will take a lot of investment by Georges to make a true run at the Picayune, which despite its enervation, still has a newsroom of roughly 130. But it throws another roadblock up for what I’ve argued is the Newhouses’ liquidation strategy in New Orleans, and the family has already squandered much of the enormous goodwill the Picayune had in New Orleans with their actions over the last year. The Advocate has a big built-in advantage in state politics and in LSU sports. It will also not have a hard time poaching talent from the Picayune and its layoff pool.

The backdrop to all this is the dismal state of the newspaper industry. We’re all for healthy competition, particularly when it means more journalists on the streets and in the newsrooms. But a war of attrition that bleeds both owners would be the worst case scenario for New Orleans, a city that needs good journalism as much as any in the country. The Newhouses have the deeper pockets, but it’s unclear how much they’ll be willing to spend to protect their declining asset and to send a warning shot to competitors elsewhere.

Launching its new tabloid, and its launching of a Baton Rouge edition of the Picayune last year in response to The Advocate’s encroachment, signals that it will not go quietly. But it also raises questions anew about why Advance killed the daily Times-Picayune while continuing to print (though not deliver) daily elsewhere.

Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR's business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu.