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For generations of journalists, life at the afternoon daily NRC Handelsblad was as warm and comfortable as a Dutch kitchen. The Netherlands' young burghers signed up for a home subscription when they got their first jobs and reluctantly let their subscriptions lapse when they died. If you were fortunate enough to work there as a journalist, you never had to worry about looking for another job. If there wasn't enough space for a particular subject, the paper simply added a supplement.

That world ended in 2000, when circulation at the Rotterdam-based paper peaked at around 270,000. Young readers stopped signing up. Circulation fell quickly; it's now approximately 220,000, and falling 5,000 to 10,000 a year. "We asked ourselves, 'Is this the end?'" says Hans Nijenhuis, then foreign editor at the newspaper.

As it happens, it was just the beginning. In March 2006, Handelsblad launched NRC Next, a splashy morning digest of the afternoon paper's best stuff, plus its own analysis and features written by a staff of young journalists. Nijenhuis, who became NRC Next's editor, thinks of it less as a daily paper than a daily magazine aimed directly at Handelsblad's lost generation of rich young readers. At one euro, the skinny NRC Next is only two-thirds the price of Handelsblad, but it looks and feels way cooler — the paper it's printed on, for instance, is slightly heavier. "Readers have got to feel that this is better than Holland's four free dailies — better even than Handelsblad — or this isn't going to work," says Nijenhuis.

Finding things that work is on every publisher's and editor's mind these days. The situation in Europe is not quite as dire as it is in the U.S., where plunging profits, shrinking staff numbers and bankruptcies are now all commonplace. But Europe's newspapers are struggling just the same. Investment guru (and owner of a big chunk of the Washington Post Co.) Warren Buffett saw this coming. In 2006, he explained the depressing law of newspaper gravity at a meeting of his Berkshire Hathaway Corp.: "Newspaper readers are heading into the cemetery, while nonnewspaper readers are just getting out of college. It's hard to make money buying a business that's in permanent decline." Here's how three of Europe's newspaper firms are trying to prove the sage of Omaha wrong:

Younger, Sexier
No one's denying the grimness of newspaper arithmetic. But, like editor Nijenhuis and his colleagues at NRC Handelsblad, some are fighting back with clever reinventions of the format. Take NRC Next, which editorially is a mixed bag of analysis and fun. You may get a recycled profile of Barack Obama; if it's good on Tuesday, why shouldn't it be just as good on Wednesday? During a big soccer championship you might find a daily photo of a hunky player with an appraisal of his physique by Next's female staffers. What you won't find much of is news. "Our readers know the news already," says Nijenhuis. "When there's a general strike in France, our readers are seeing it on the Net at the same time the NRC Handelsblad reporter is covering it."

When it launched, NRC Next gave itself a goal of 80,000 daily readers in three years. NRC claims the paper's selling about 10,000 over that mark and that it made a profit of about $3.3 million on sales of $25 million in 2008. "Newspapers are so conservative, and now they're panicking, saying they've got to cut quality, cut costs," says Nijenhuis. "We say that's exactly what you don't do."

Why is such innovation coming out of Europe, so often dismissed as bereft of new business thinking? There are several reasons but foremost is competition. The U.S. newspaper landscape is a patchwork of one-newspaper towns. Profits are traditionally sky-high — margins run to 30% in some cases — and so is resistance to change. By contrast, Europe is a bloody battleground of national dailies, all clawing at one another. Competition breeds creativity, not to mention a willingness to live with slimmer profits. "The U.S. lost the beat on newspapers around the year 2000," says Vin Crosbie, a partner at media-consulting firm Digital Deliverance and the fifth generation of a Connecticut newspaper-owning family. "I'm just amazed that most U.S. newspapers update their websites once a day. In Norway, if there's a car crash, they update the whole paper."

Online or Dead
It's no accident Crosbie mentions Norway. That's the home of Verdens Gang, or VG, an Oslo-based afternoon daily often cited as a model for how to thrive in the brave new newspaper world. VG is owned by Schibsted, a media conglomerate that embraced the Net early and rode out seven years of heavy losses before getting it right. The stock market wanted CEO Kjell Aamot's head, and Schibsted's board was fully prepared to give it to them. Only Tinius Nagell-Erichsen, the revered former chairman who controlled the Schibsted family's trust, said no. Now VG's website, VG.no, is Norway's biggest destination, period. In 2007 VG Nett, the paper's online arm, had pretax earnings of $23.4 million on revenues of $55 million, up 44% over 2006 and accounting for just over a third of VG's total profits. Online ad revenue is also over a third of VG's total. That's simply unheard of for most newspapers.

There's an ancient, hand-cranked printing press in Schibsted's spanking modern lobby. Founder Christian Schibsted used this press to print his first newspapers in the mid-1800s. It stands as a poignant reminder not just of where the newspaper is coming from but where it's going. In the first nine months of 2008, the print version of the newspaper sold 290,000 copies a day on average, down 21,500 from the same period in 2007. Daily readership of the newspaper alone has dropped by close to half since 1997. Two years ago, in what seems a surprising lack of team spirit, the VG Nett folks strung a triumphal banner across their offices when online readership surpassed print readership: "Storre enn mor!" (Bigger than my mom!)

Torry Pedersen came up through the paper's ranks before moving to VG Nett. Today he's managing director for all of Verdens Gang, but he doesn't get sentimental about the smell of ink. As far as Pedersen is concerned, VG Nett got to where it is by ignoring the verities of newspapering and inventing a new set of rules. For starters, Pedersen and his editors try to identify the day's sexiest story — anything from Israeli air strikes on Gaza to Britney Spears; "we don't care how important it is in typical newspaper terms." He then throws waves of reporters at it, updating the story continuously with material that he'll take from anybody and everybody. "The Net has broken the newspapers' monopoly on production and distribution," says Pedersen. "You always find that the first photos after a big event come from ordinary people." The site discovered that after the Asian tsunami of 2004, when photos uploaded from the cell phones of survivors gave VG Nett its most striking images. Those photos helped drive the website's readership to an all-time high. Pedersen now has a dedicated phone line — 22 00, if you see anything interesting — to transfer photos automatically from any cell phone directly into VG's system. "Most newspapers view the Internet as a new distribution outlet. VG looks at it as a new way of reading," says Bharat Anand, a professor of corporate strategy at Harvard Business School who used Schibsted as the subject of an admiring case study in 2007.

Anand's case study compared VG.no's 6 million monthly readers (it has since grown to 8 million) to NYTimes.com, which at the time had 14 million. VG got 11 page views per session and almost 10 sessions per visitor a month — both figures almost twice those at the Times when the study was done. That boosts ad rates considerably. "If VG had the Times' numbers, revenue would fall by three to four times, and the site would be a loss-making entity," says Anand.

One of the debates raging in the newspaper world is whether yesterday's ink-stained wretches can be reprogrammed for a digital future. Pedersen says no, and he's not kidding. VG Nett is a separate company from the print Verdens Gang; it takes only 5% of its material from the newspaper, and hires young, inexperienced reporters. When the paper cut editorial staff, Pedersen didn't offer a single one of the old boys a job. "Just tell me the last time the same person won the 100-meter dash and the marathon," he says.

A Fresh Angle
Alan Rusbridger, editor of Britain's Guardian newspaper, takes a different view. Like VG in Norway, the Guardian was among the first British papers to recognize the Internet as the only portal in the storm that was buffeting traditional newspapers. Its own title wasn't spared. The Guardian's circulation was 516,000 in 1986; last year, it was down to around 351,000 copies. Unlike VG, however, the Guardian has bet its building that the future lies in so-called media integration — the same single staff for newsprint, Internet and the video and audio reportage that are increasingly turning Internet news into a multimedia circus. The Guardian's new headquarters in the King's Cross area of London — it moved in December — houses enough video studios and fancy hardware to allow the Guardian to compete not just with other newspaper sites, but with CNN and the BBC.

The move has also triggered a massive reorganization of the Guardian's editors, reporters and photographers, designed to bust all barriers between the paper's different delivery platforms and end the balkanization of its often hostile tribes. As Rusbridger put it in a column shortly after the move, "There was not enough communication between papers and website, nor coordination of resources across seven days and four or five different media." But the blender approach can also leave an editor with a list of new tricks and a bunch of old dogs. Concedes Rusbridger: "It does sometimes dull the edge of coverage."

Every so often, though, you stumble on a Sean Smith. In 2003, the Guardian gave its celebrated war photographer a training course and a video camera, then told him to go to Iraq and play around with it. In the past three years, Smith has been nominated for an Emmy and won an award from the Royal Television Society, the first news stills photographer to be so honored.

Under Rusbridger's stewardship, the Guardian site has become one of the newspaper industry's most lauded, winning a kind of online Oscar called a Webby as best newspaper site three years running. Guardian.co.uk claims around 29 million unique monthly visitors, which puts it atop a fierce three-way tussle with the Daily Mail and the Daily Telegraph for the most online readers. The Mail and Telegraph have actually caught up quickly in the past year. But Charlie Beckett, a professor at the London School of Economics and author of SuperMedia, argues that it matters little which newspaper claims more online readers. "Whether one of them's got 15 million and the others have got 10 million is irrelevant economically," says Beckett. "Rusbridger's job is to save his own community and build on it so he can sell them stuff in the next phase — it could be a ticket to a conference, it could be a social-networking site, anything. The other papers are doing the same thing for their communities. I think Rusbridger made the right business decision."

In a sense, the Guardian's community is unique, and bears little resemblance to the competition's. Only a third of Guardian.co.uk's readers live in the U.K. Some seven and a half million of them live in the U.S., making the Guardian perhaps the least local newspaper in the world. In Oct. 2007, the Guardian made that fact clear by launching www.guardianamerica.com, with its own American editor, political-news veteran Michael Tomasky, and a dedicated staff of 12 journalists. Clearly, the newspaper is staking its survival on becoming a global news brand.

But it's still got a long way to go. In the year ended March 2008, Guardian News and Media Division lost $52 million on turnover of $520 million and figures for the year ending March 2009 are likely to be substantially worse when they are released in the summer. (Fortunately, the Guardian is owned by the nonprofit Scott Trust, whose purpose is to safeguard it from the chill wind of the market.) Like other online newspapers, the Guardian has yet to figure out how to monetize its millions of visitors — in other words, how to make a buck off them. According to calculations made by Digital Deliverance's Crosbie, it takes 16 online readers to make up for one lost print reader on the bottom line. "If you do the math, you see they're never going to make the money they were used to making," he says.

Even so, some of Europe's most hide-bound institutions are realizing that drastic change may not be such a bad thing. France's truculent leftist daily, Libération, was founded by Jean-Paul Sartre and a group of former Maoists in 1973. In its early firebrand days, employees from the editor to the janitor all received the same salary. It's been on life support for years, and it's a wonder no one's pulled the plug.

Today, Libé has a new benefactor in the form of Edouard de Rothschild, and a new unstarry-eyed editor, Laurent Joffrin. The paper flirted briefly with break-even in 2007 and it's trying to find a way to go post-ideological, sort of. The Net, conferences, French open-shirted philosopher Bernard-Henri Lévy shilling with advertisers — the new Libé will try almost anything. Joffrin even invited Carla Bruni, wife of France's rightist President Nicolas Sarkozy, to serve as celebrity editor for a day, but that was a step too far and Joffrin was forced to rescind the invitation amid howls of protest from employees. "If all we're doing is telling readers who's on the new équipe de France soccer team, we're dead," says Max Armanet, the Libération editor charged with finding new ways to get readers fired up again. "It's my job to make people desire us — I am the editor in charge of Love. I can't tell you whether we'll be here in five years, but I can tell you it's a passionate undertaking." Passion probably isn't a bad place to start.

• Josh Levine / Amsterdam
• Plummeting circulations, anemic advertising sales: the news on Europe's newspapers makes for grim reading. But some publishers are fighting back. Here's how three are trying to keep their black and whites out of the red