Here are few new articles from Bayoubuzz on the T-P situation:
http://www.bayoubuzz.com/buzz/item/7397-new-orleans-times-picayune-digital-media-future-shock-is-no-gas by Stephen Sabludowsky
and
this one by Sid Arroyo.
Personally, I think Stephen is right to point out that the future is largely online. But that doesn't mean there isn't a place for local dailies in print format. The traditional media will have to revamp, and that very well could include significant reductions in staff.
Sid hits on a point that I think needs to be brought out and that is the influence of corporations and corporate profit concerns. The T-P, reportedly, was profitable. It may not have stayed that way, but it was at the time of the axing. From the outpouring of support from the New Orleans community, it's also clear that there is a loyal and dedicated readership for the traditional paper. What is striking is just how little the corporate officers of Advance/Newhouse care about the people of New Orleans. It's understandable as those officers don't live and work in the city, but that's just it - the T-P was a paper for the community of New Orleans. The ones responsible for dismantling it are not.
The reality is media has to change. We are experiencing a time of adjustment as we figure out how to handle the new reality of life in the internet age. There are a number of questions that still have yet to be answered (and maybe even a few yet to be asked).