"We know readers will buy my newspaper for advertising content," he says. "In my opinion, these same readers don't go to my website to buy those things. They go to specialist sites, and there are loads of them."

Because online advertising can be successful even if it is unbundled from editorial content, the Herald set out to find new ways to attract advertisers. "If we could create great content that could generate good response for advertisers, everyone would be happy," says Mr Phelan.

He described one approach that pushes the line between advertising and editorial content. The Herald has essentially reproduced television contests in print – "The Apprentice, "American Idol," and "Pimp My Ride" were the models – covered the contests extensively in editorial columns, and drew new advertisers, readers and new revenues with the approach.

"The concern was that we crossed the line between editorial and advertising and compromised the credibility of the newspaper," says Mr Phelan, who rejects the argument, citing strong negative coverage of one such advertiser when he had financial and legal trouble. "The point is, if we run an innovative ad campaign, it doesn't effect us editorially when the person become a news story," he says.

With online pure-players cutting into local markets --  the Herald is a small paper with 22,000 sales a day – such new approaches are needed, Mr Phelan says.