So the big news today in the journalism is the dolphin that wanted to swallow a whale. After much pressure and machinations, word came last night that McClatchy Newspapers will buy Knight-Ridder in a deal worth $4.5 billion. Knight-Ridder owns 32 daily papers to McClatchy’s 12.

The deal, if it goes through, will create the nation’s second-largest newspaper publisher by circulation behind Gannett, the WSJ reported. “Gannett’s 91 U.S. daily newspapers have a combined daily paid circulation of approximately 7.3 million. Knight Ridder, with 32 daily and 65 nondaily newspapers in 29 U.S. markets, had an average daily circulation in 2005 of 3.3 million. McClatchy, the nation’s eighth-largest newspaper chain, had 2005 daily circulation of 1.4 million.” As part of the deal, McClatchy will sell 12 of the Knight-Ridder papers that don’t fit its traditional business model.

“Because Knight Ridder is so much larger than McClatchy, the merger is likely to create some upheaval for both companies. McClatchy could sell or close some of the Knight Ridder papers and could take further cost-control measures in its own newsrooms to help finance the deal. It was uncertain when the deal would be completed,” the Times reported this morning.

The effect on the reporters and the institutions of course is the big unknown today. Will we be seeing Superbureau Number 2 as the Raleigh News & Observer merges Washington correspondents with Philadelphia Inquirer? How many newspapers in smaller markets or how many competing papers will close altogether?

As a new Project for Excellence in Journalism report shows, newspapers face a pretty dire situation, and this deal isn’t likely to change that.