The cover story of BusinessWeek is "The Future of the New York Times".
Apparently, the online version of the New York Times is quite profitable ($17.3M net on $53.1M of revenue in Q1 & Q2 2004). Despite this success, the paper is considering requiring online subscriptions.
It's a little curious. Only a few months ago, the Wall Street Journal experimented with allowing unrestricted access to its content to see the impact on its traffic. Now the New York Times is considering restricting access to its content to paid subscribers.
The BusinessWeek article spends a fair amount of time on the distinction between subscription and "free" news websites. It's isn't really correct to say the New York Times is free for users. It isn't uncompensated; it is supported by advertising. Readers pay for the content by viewing advertising.
Google is compensated and compensated quite well by users of its "free" search engine. On average, Google makes 54 cents per click on an advertisement and nearly 17% of searches end in a click on an advertisement.
Rather than destroying their traffic by restricting access to their content, perhaps newspapers should improve the relevance and usefulness of their online advertising.
[BusinessWeek article via Steve Klein]
Update: As Maarten pointed out (in the comments), I made a couple mistakes in my original post. They have been corrected.