I was on NPR today talking about this [1], and while I was the least insightful guest, I think that a lot of it boils down to still thinking like a business with 35% margins and huge headcount, rather than a scrappy underdog (that for some reason has a huge paper-distribution network in the Metro NY area tacked on).
[1] http://onpoint.wbur.org/2011/03/28/paywall-debate