NY Times chose to make itself hard to use on the iPhone. NY Times is charging money for content. NY Times loses a customer. Loses one its most valuable assests, a hard copy subscription customer. Hard copy paying subscribers are the basis for NY Times advertising revenue. It not only loses my $1,000 a year subscription but loses points on the rates it charges advertisers. And NY Times (and all papers) are losing paying subscribers.
My guess is that NY Times, by agreeing to put its access inside Apple's "Newstand" application, hopes to gain digital customers. It's choice was to aggressively market its digital content subscriptions by itself or hope that being a very small speck on Apple's content marketing produced more customers for the Times digital content.
Problem in being dependent on Apple is NY Times loses control. Plus Apple will take the highest bidder for all important placement on the Newstand and NY Times will get outbid by other media.
Washington Post, Wall St Journal are not trapped in the "Newstand" so Apple no doubt offers an incentive to content providers, good for Apple, bad for the content provider. Hard to see what promotional or sales value "Newstand" provides while burying the company's product on the devices and in the online store.