Unless anybody has any other bright ideas, this is inevitable, and necessary. There's no way the NYT—or most other papers—can continue to allow their own free website to cannibalize their revenue forever. Print subscription levels will probably never rise again in a meaningful way. Online news is the future. Online ads bring in only a fraction of the revenue of print ads. Therefore, the website has to find another way to generate cash. And that way is charging for content.
If all 650,000 print subscribers paid $5 a month for the website, that would be an instant $39 million per year. More likely, many people would choose either only the print subscription (old people) or only the online subscription (non-old people). That means that the NYT could potentially sell many more online subscriptions than it sells print subscriptions. Its website is orders of magnitudes more popular than its print product already. Five bucks a month is not an outrageous fee for the premium newspaper site on the internet. Yes, the Times would lose some online readers, and therefore some online ad revenue. But they should be able to make up much more than that by charging a reasonable fee—particularly as this practice spreads and becomes more accepted. Bitch now, pay later. The paper will still have to face some pretty severe staff cutbacks. But this is the future. If you like to read the NYT, pay up.