Before replying to Arthur Smith, below, I will summarize some critical distinctions that some contributors are failing to make. I think that when these are made, broad lines of agreement will be seen to emerge. From the optimality of a free online refereed journal literature, it follows, on an individual author basis, that publicly self-archiving one's papers would free the literature. If every author did that today, the optimal would be here tomorrow. Self-archiving authors' own refereed papers now is such a step.
Many contingencies are possible.
No one knows exactly what shape the online literature will take eventually. Readers will overwhelmingly prefer to use the free online versions. Again, the empirical evidence from physics is that readers will become quickly and overwhelmingly addicted to using the free archive. This may mean cancellations will never come, and that this prediction is wrong, or that cancellations will come more slowly than the change in usage patterns, and may possibly be awaiting a generalization of the effect from Physics to the rest of the disciplines.