It makes me wonder of Rupert Murdoch really understands how the Internet works, but he's threatened to block Google from searching his Web properties in favor of a pay model for content. Murdoch is the founder and CEO of News Corp, which owns multiple media companies, including The Wall Street Journal, Hulu, MySpace, and Fox.
Google has always had the position that any webmaster could block Google. All they have to do is use the industry standard robots.txt protocol, and Google will pretend that the site doesn't exist. However, charging for content and being found in search are not mutually exclusive ideas. Google is even working on a micropayment system to make it easier for newspaper and other publishers to charge small fees for accessing content.
Even so, convincing visitors to pay for your content is the second hurdle. They have to find your site first. Murdoch said in a recent Australian interview that he'd rather have fewer paying customers than more non-paying visitors, but he may be disappointed in exactly how well his wish is granted. Such a move would likely cut off 25% of their traffic. The long-term loss would likely be greater as fewer new users discover the sites.
Then there's the second hurdle. The value of the content. The Wall Street Journal has been experimenting with a pay model, but it seems silly to think this will translate well to other sites like the New York Post or Fox.com.