Two parts to this: The sale and the closures. The first probably is (on balance) more improvement than wash; the second is simply sad.
The paper sold is the Wood River Journal, the weekly at prosperous Hailey (though it competes with another substantial paper, the Idaho Mountain Express, just a few miles away at Ketchum). For many years locally owned, the Journal was sold in 2004 to Lee Enterprises, which also owns the dailies in Twin Falls and Burley and most of the other newspapers in the Magic Valley. The new deal sells it to a group of several owners, but the lead participant and manager will be the Post Company, whose best-known property is the Post-Register daily at Idaho Falls.
Newspapering in Idaho east of Boise has been slipping into ever fewer hands. Once highly diverse - just a generation ago the bulk of these papers were in separate ownerships - now nearly all are in the hands of Lee, Post or Pioneer Newspapers (which have the papers at Pocatello, Rexburg, Nampa, and Logan, Utah, among others). In one sense, the new Journal deal just moves the Hailey property from one big owner to another. But locals will be among the owners, and Post still is based in Idaho, at Idaho Falls. So that probably qualifies as a net plus. (Plus there's the point that Post generally puts more resources into its news operations.)
The sad news is Lee's announcement at about the same time of the shutdown of two of its weekly papers, the Lincoln County Journal at Shoshone and the Minidoka County News at Rupert, adding two to the Idaho counties unserved by a local paper. Minidoka County has a population of about 20,000. (As a technical matter, we should note that a slice of the city of Burley, the county seat of Cassia County, is located in Minidoka; but the daily there is based in Cassia.)
The closures were attributed to weak circulation and advertising bases.