Mecom, of which Montgomery is chief executive, publishes more than 300 titles in several European countries, mostly in the Netherlands, Denmark, Norway and Poland, and unveiled better-than-expected results in a trading update yesterday.

“Scandinavians and in particular smaller papers in Norway are making faster strides in online revenue development,” Montgomery said.

“We are concentrating on one or two initiatives to capitalise on that more aggressively [across the group]. There is enough evidence to demonstrate that newspapers can be transformed and exploited [successfully] online commercially.”

With a carefully planned digital strategy, he said, the company could make up for permanent losses in print ad revenue in the future, thanks also to a cost-cutting programme that had yielded about £124 million, well surpassing the company’s original target of £67 million.

He was confident that Mecom’s digital strategy could earn enough to compensate for the predicted fall in print ad spend this year, which he put at five percent across Europe.

Mecom had learned some lessons from the beginnings of its online pay strategy, he added – which has involved charging for “high grade” legal and financial information in its Polish newspaper business and an online paid-for magazine in Denmark – but 2010 would see a significant ramping up of the plan.

In Norway, he said, Mecom was looking to invest extra funds to develop more local online content, with the aim of getting as many digital users per day as print readers per day. “The goal, frankly, is to capture the market locally online as we have in print.”

In yesterday’s trading update, Montogomery said that Mecom would face a further “major upheaval” in 2010 as the new digitally focused strategy was implemented.

Asked what he meant by this, he said: “It is about working practices and the redefinition of roles of newspaper staff, this is the real revolution. You cannot employ armies of people who produce one newspaper title. A business needs to be in content departments that service a range of products in print and online.”

But newspapers would also survive, he argued.

“The crisis is not to do with print or newspapers, it [has been] a crisis of advertising,” he said, adding that circulation and subscriptions at Mecom had stayed relatively solid throughout the downturn. “Advertising [decline] is now clearly moderating. People who have written off newspapers have clearly done so far too soon.”

Mecom’s share price rose 16 percent yesterday following its trading update.