Xanadu was ahead of its time in many ways, but the reason why the web took off the way it did I think has to do with the free and open nature of it.
The basic idea behind xanadu was that information could be re-cited as often as you wanted but the originator would get a slice of the cake.
The web is the opposite, it's a total free-for-all with the spammers and the parasites being on the same level as the originators of the content. Nelson saw it differently.
Early attempts at something like the web in Europe (minitel in France and videotext in the netherlands and germany) tried to charge 'by the page' for the content, but this seriously limited the amount of information available. Information providers could set a price on their information and the 'links' would display the price prior to activation. Billing was done through the telco.
If every web link came with a price attached I think it would have never gotten off the ground the way it did. Still, there are some good elements in that philosophy and I'm sure that in the long run 'for pay' links and some kind of citation mechanism will find their way back in to the web, simply because they are useful and because there is much demand for it (from the content providers side).
One potential way to realize this today is by setting up a gateway that deals with pay-per-view content where information providers could host their data and a plug-in based viewer (flash or something like it) that unlocks the content if the client has enough credits and confirms they want to see it.
It would have, but as far as I'm concerned Xanadu, as visionary as it was turned out to be an evolutionary dead end.
This is not to be disrespectful to Ted Nelson, it's just that the good bits are going to be recylced even if the grand vision won't be.
Some elements from Xanadu would solve the problems the AP is trying to address but I highly doubt that it would be commercially feasible without some kind of collusion between all the news providers. After all, as long as one of them stays free that one will end up with all the customers in their basket.
It's a free market, and the market deals harshly with those that try to sell lemons while the neighbours find a way to give them away and still make a profit.
