Chief executive Murdoch MacLennan announced on Friday that the group would be investing £150m in new production facilities and improved colour capability.
The investment is part of a major restructure, which will include massive staff cuts as well as a possible relocation from Canary Wharf to Fleet Street.
However, far from a return to the past, the move represents the latest big move by a newspaper giant towards a brutal new commercial reality in the sector.
As well as a sign of the reclusive Barclay Brothers expecting a return on their investment after their £665m purchase of the Telegraph titles last May, it is an indication of a much wider fight for survival by the entire national newspaper market, amid falling circulation and a desperate scramble to get the most advertiser friendly printing facilities.
MacLennan said action to improve the Telegraph Group's production capabilities amid the increasing competition in this area was vital if it is to "survive and prosper in to the future".
"We will invest in the new production facilities to provide full colour newspapers to meet the aspirations of both our readers and advertisers," he said.
"The £150m investment programme will be funded in part by a major reshaping exercise across the entire organisation. This will see the number of journalists in The Daily Telegraph and The Sunday Telegraph reduced by about 90. Staff savings are already being implemented in non-editorial departments."
Altogether, the paper is cutting 17% of its staff across the board.
The Telegraph's moves may be the most dramatic, especially in terms of journalist staff cuts, but they follow other measures by the big newspaper groups to modernise their operations.
In October, News International, parent company of The Sun and the News of the World, announced it was moving its print operations from Wapping to new sites in north London, Scotland and Liverpool in a move costing more than £600m and also expected to result in hundreds of redundancies.
Rupert Murdoch effectively – and not for the first time – hurled a challenge at the rest of the industry with the prospect of full colour pagination.
Meanwhile, the Daily Mail and General Trust – owner of the Daily Mail, Metro and the Evening Standard – has spent nearly £100m enhancing its presses.
Some in the industry point to the arrival of Richard Desmond as owner at another fierce Telegraph rival, Express Newspapers, in 2000 as the start of a new era of ruthless competition.
At the time, senior Telegraph figures openly spoke of their disgust at his policy of axing hundreds of journalist jobs and combining resources on the Express and The Star.
Amid the new reality, the Telegraph is also facing up to cutthroat competition from the likes of The Times and The Independent, which have both gone compact, with The Guardian planning to invest heavily in its own so-called Berliner sized product.
Faced with this and consistently falling circulation figures, the Barclays have shown themselves to be part of a new breed of owner unafraid to take radical steps to transform their operations to grab all-important advertising revenue.
Paul Woolfenden, managing director of another Barclay brothers'
publication, The Business, summed up the situation this week when he said: "Newspapers are on the wrong end of the maturity curve. Every newspaper has to fight for every copy. We took a decision back in 2003 that we had to do things differently."
The Business has instigated measures including delivering free copies to AB homes and a tie-up with magazine companies to see The Business packaged with a range of different glossies to try to boost circulation. But the change to more radical commercial measures is by no means confined to niche titles like The Business.
It would have been unthinkable a few years ago for the Telegraph titles to offload nearly a fifth of their journalists, but the announcement at the company follows a brutal clearout of senior management on the commercial side under the Barclays.
Virtually the entire old guard has been ousted, including managing director Hugo Drayton, commercial director Mark Payne, sales director Chris White-Smith and marketing director Mark Dixon.
As well as MacLennan, ex- Associated Newspapers' managing director, the group has brought in John Allwood, former Orange UK boss, Dave King, previously Emap's head of advertising, and Jim Freeman, formerly ZenithOptimedia's press boss.
The new team will benefit from an investment in new presses that will be the envy of their predecessors, who have long bemoaned the restrictions heaped upon the paper because of its print sharing arrangements with Desmond at the Westferry printing plant.
Steve Goodman, press director at MediaCom, said the latest changes made economic sense.
"The Telegraph has an issue with colour in its presses and they are very restricted and they are missing out on an awful lot."
But Goodman warned that the group should guard against editorial cutbacks that diminished the quality of the product.
"If the content isn't there in the future, in the long term it is going to impact on the circulation and the quality of the people buying it," he said. "If the titles lose circulation and quality of readership, they are naturally going to lose demand for advertisers."
Adam Crow, a director of Omnicom's pooled buying operation, Opera, said: "When I heard about the cutbacks on the editorial side, it reminded me of streamlining that Desmond put in place when he took over at the Express.
"I think newspapers are increasingly more commercially focused than they had been in the day of the press barons.
"I didn't realise the Telegraph was that fat, but you never know until you take over, do you?"
One Telegraph source said of the Barclay Brothers: "When they came in, they were keen to push the message that they wanted to take time to understand the title, but they haven't taken any time and they certainly haven't understood it. I don't think the changes will stop for a long time yet."
The Telegraph has ruled out following its rivals in a switch to compact size, even launching an advertising campaign on the back of the fact that it is remaining broadsheet, but few expect the announcement last week to be the last at the paper – or elsewhere in the sector.
On Friday, Metro featured what many would argue is the antithesis of an urbanite read – an eight-page pull-out of the Daily Mail slapped between the TV pages. Also, the front cover and inside story took a strong editorial slant on the issue of poverty – which some agency figures see as out of character for Metro.
Unconvinced of the effectiveness of Associated's move, Mark Gallagher, press director at Manning Gottlieb OMD, said: "It raised my eyebrows because it [last Friday's paper] is not Metro –Metro prides itself on being quick and snappy in an easily digestible format, not necessarily having politics rammed down your throat."
Gallagher added: "I want to talk to them [Associated] about this to see if it is going to be a strategy ongoing. One reason we use Metro is because we can target those people who don't necessarily want all the comment and the spin.
They just want some news and that reflects the type of people they are – which is exactly what Metro is there to do."
Just as Rupert Murdoch admitted recently that the commuter freesheet has eaten into The Sun's circulation, it would seem that Associated's flagship title too is suffering just as Metro has emerged as the newspaper group's rising star.
In last month's Audit Bureau of Circulations figures, the Daily Mail was down 3.7% year on year to 2,318,824, while Metro jumped by 12.5% to 1,002,690.
Dan Pimm, press manager at Universal McCann, believes closer association between the titles was an imminent prospect.
"It is about time they started helping each other out, but I don't think it really reflects well on Metro.
It's quite an odd fit even though it is under the same group," said Pimm.
But Steve Goodman, group press director at MediaCom, argued that advertisers would see the addition of Mail editorial as an added bonus.
"It wouldn't surprise me – if this works – that maybe we will find other elements of the Daily Mail, such as the financial pages, to encourage readers across," he added.
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