I've just had an awkward situation where I quoted way too low for a database driven site and when the users requirements changed to increase the size of the project we both kind of lost interest. In the same week period I quoted £500 for a small static business website, £650 for some excel number crunching and £470 for what turned out to be a multi-domain, multi-site, multi DB system. What was I thinking?
So the moral of the story is... you can always come down if you quote too high, but it's much trickier the other way round. For a newspaper, even a free one, I'd be tempted to look at what they charge for ads and at the very least charge what they'd get for 15 (big) ads in one issue - you'll be helping drive business to them for an indefinite period of time so you should charge accordingly.
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