New York Times Will Win in the Long Run

The move was also a sign that pressure from Elmasry's efforts is being felt in the company's boardroom, but those familiar with its owning family say there's little chance that chairman and publisher Arthur Sulzberger Jr. will ever give in to his demands.

"It will be a cold day in hell before the Sulzbergers open the door to giving up control of the business," says Susan Tifft, co-author of The Trust: The Private and Powerful Family Behind The New York Times and a professor of journalism and public policy at Duke University. "The family members in Arthur's generation will do whatever is in their power to protect and preserve the essence of the New York Times, which is really the newsgathering operations."

The Ochs-Sulzberger family trust controls the company by holding its Class B shares, which make up only 0.6% of its total shares outstanding. Meanwhile, they control 70% of the company's voting rights, while the vast majority of shareholders control just 30% of the votes.

The arrangement allows outside investors to partake in the fortunes of a company when times are good, but it gives them little recourse to effect change when things go awry. And right now, things are certainly going awry for newspapers.

With audiences turning to the Internet for information, the historical advertising model for the media industry is being destroyed. People who read the Times online spend much less time on it than those who still sit down and read the physical newspaper everyday. In turn, companies pay less for ads, and a chunk of the ad spending goes to news aggregators and online portals like Google (GOOG Quote) and Yahoo! (YHOO Quote).