Really all this is going to achieve is to drive readers away from conventional news sources to less conventional ones. Google doesn't control ads on most Murdoch media sites, but it does control ads on many blogs. Potentially Google could make more money by having people spending time reading news related blogs and less time on other news sites.
In that thread I've explained what First Click Free really is (its not new), because the BBC article is quite misleading. This is a small policy change to throw a bone to top-tier publishers like NYTimes, and is unlikely to have the impact you've described.
