It's safe to say that no one at The New York Times Co. is happy about the need to compromise the company's greatest asset—the peerless news-gathering operation of its namesake newspaper—in the face of growing costs and shrinking revenues.

But that's not to say there aren't those who regarded last month's announcement of plans to downsize the newsroom by 100 positions as a victory of sorts.

According to a number of current and former New York Times employees, that decision marked the culmination of a period of heightened hostility between the paper's business side, which felt that it had made more than its share of sacrifices in previous round of cost-cutting, and the editorial leadership, which favored doing everything possible to protect the paper's competitiveness.

"It's been an ongoing tension for awhile," says one source close to the business management. "The business side believes they've taken the majority of the hits so far while the newsroom has stayed untouched."

Even the present round of cuts, notes the source, will do no more than restore the newsroom's staffing level to where it was three years ago, around 1,200—and that's not even counting journalists on the digital side.

"They just went too long without significant newsroom cuts," agrees a former editor. "And every time there were cuts, the business side got increasingly perturbed because the news department was so protected."

Of course, a tug-of-war between editorial and business interests is a fixture of every newspaper (and magazine, and TV network, and blog network...)—a point one source in Times management was quick to make.

"This is something that's persisted for years and years now," says the source, who like other employees agreed to speak candidly only if not identified. "Everybody in the newsroom, reporters as well as top management, understands the business environment. This isn't some marital dispute that's led to the baby being put up for adoption."

But a former executive insists the sense of aggrievement had, in fact, become acute. "There's always a natural tension" between the business side and the newsroom, he says. "This goes well beyond that. It had become more than just a normal debate."

In this source's view, the cuts under way now are as much about mending this rift as they are about improving the bottom line.

"It's symbolism," he says. "It's not like the $5 million or $10 million or whatever the number is is going to get them into significantly better business performance. I don't think the problem with the Times is that the newsroom is inefficient by 2 or 3 percent.

"The real issue is, what is the business side doing to monetize the content? Are they doing all that they can to operate in such a way that the business could be profitable enough to pay for all that great journalism?"

Of course, it's not as though the Times is alone in turning to head-count reduction to get through the present economic crunch. The Washington Post, Los Angeles Times, USA Today, and Newsday on Long Island have all recently announced workforce cuts including newsroom positions.

But the Times has never been just another newspaper, says Ben Bagdikian, emeritus professor at University of California at Berkeley's School of Journalism. Rather, it's the newspaper all other papers take their cues from. "Given the importance of the Times, any cutback is significant," he says.

And the Times faces some unique pressures. First, there are the two hedge funds that are aggressively pushing actions they consider necessary to improve profits—selling the Boston Globe and focusing more on digital growth. As of Friday, when the funds formally proposed four directors to the Times Co. board, it was unclear whether the company would have a proxy fight on its hands.

Then, of course, there's the hugely increased threat the Times faces from the Wall Street Journal, whose new owner, Rupert Murdoch, has made clear his intention to challenge the Times's dominance in political news, cultural coverage, and other areas.

"Having a big fat debate between the business side and the newsroom side while Murdoch's saying 'I'm going to take you out'—tell me how that's supposed to make sense," says the former executive. "They ought to be looking outward, at how they can work together."

And then there's also the added strain of covering a presidential election, two foreign wars and the Beijing Olympics all simultaneously.

"Since they're doing it in this context, they're obviously feeling a lot of pressure—or they've realized that they're overstaffed," says Charles Kaiser, a former Times reporter and Newsweek press critic.

In short, it's hardly a convenient time for the Times to be losing people like Linda Greenhouse, the longtime Supreme Court correspondent who accepted a $300,000 buyout. "A lot of people were shocked by that," says a veteran Times man.

Not as shocked as they may be in the near future, however. The deadline for accepting buyouts is tomorrow; if enough people don't step forward, Times management will resort to layoffs to make up the difference.

"It will be very shocking if they have to resort to layoffs," says long-tenured writer. "People here are used to the idea that that doesn't happen here."

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