Associated Press has generated a lengthy newsfeature on the debate involving whether it's smart to charge for online news. AP itself is in the midst of testy discussions with search engines like Google and Yahoo and with the blogosphere over their use of AP material.
Given AP's recent aggression toward those who clip too much of its dispatches, let me suggest you follow the link here and have a look.
There is very little new ground covered, but it does end up suggesting that niche material has the best opportunity for monetization. That said, it also quotes those who doubt newspapers are sufficiently savvy to identify and milk those niches.