I don't know whether Kindle will be saviour of newspapers, in its current form I don't think it will be. The problem for newspapers is that we web users are now used to reading articles from several different newspapers at zero cost ( I reckon I've looked at about 20 - 30 newspapers in the last week), so we aren't willing to revert to paying a significant sum to read just one paper.
The Kindle solution is to offer subscriptions to papers, but that restricts readers to one newspaper. Some newspapers have tried to charge for web articles before but usually the price has been ridiculously high- The Independent used to charge about £1 per article which was more than the whole dead tree publication. Who wants to pay that much?
A traditional newspaper costs 40p to £1.50 and contains dozens to hundreds of articles, so therefore the value of each article is usually pennies or fractions of pennies. Therefore if the newspapers want to start charging for articles in a way that doesn't cause a complete collapse in readership they need to create a system of micro charging, in which users can create an account put some money on it and then browse the web with each publication getting a very small fee per article read, although cumulatively the amount spent per user will be pretty similar to what is currently spent on physical newspapers. The technology exists to do this, google ads use a similar system where each ad clicks generates a few fractions of a cent, so it is feasible.