That's not true at all. It makes perfect sense to published subscription-only content online, the first of which being convenience. Readers who pay for a subscription may want to read the daily the same time they check CNN, or their email. It makes sense to publish it online, whether it's commercial or not.
To insist the internet is solely for free-speech and communal sharing doesn't make sense. It's not some grandiose, free spirit nirvana. It's a form of media, and as such publishers have the right control content they publish.
The two concepts aren't mutually exclusive. If people want to produce subscription-only content, that's certainly their right to do so.
If, somehow, somewhere, content is made freely and publicly available on the web, expect Google to find it and index it. There's nothing wrong with that.
I think the problem may be that according to Google's "first click free" policy, people who do Google searches are able to circumvent the subscription policy and see the content for free. Simple solution: "first click free" is a voluntary policy, if you don't want to participate, configure your website accordingly and you're done.
As everyone keeps saying, the correct solution is to have article teasers and summaries that are freely available, without a subscription, and that get indexed into Google. People will search for those, find it, and then be sent to a page that says "please subscribe if you want to see the rest of the story". Removing yourself entirely from Google would work, too, but that's more of a "cut off nose to spite face" scenario.
But the real problem I have with this story is Microsoft's involvement. Microsoft paying someone to remove all their search results from Google seems a bit underhanded (though not particularly surprising). I feel it's a slippery slope, and of course it undermines the entire purpose of search engines.