An interesting read. He goes too far when he states that he eventually envisions the big media being funded by the government and people flocking to new media solely on the basis that it is "cool".
He states that allegiance to the mainstream media is based on inertia, but misses that it is also based on credibility and at least an *effort* to be objective. Of these new media outlets, how many of them are credible? People like the idea that there are editors that act as a filter for content and check for accuracy. Also, how many of them are objective? Isn't it a little obvious that the New Ledger slants strongly right? Is that the only place people are likely to get their news? It seems to me that mainstream media will continue to dominate, but people will also seek other websites to get alternative views.

As for the government, it has more effective means of "controlling" media by controlling access rather than granting money. As Republicans have mentioned a lot on here, some reporters don't get invited on the plane. Sites that don't have access to the information won't attract readers. I don't see government directly funding the media.

Newspaper bailouts are not nearly as far away as you might think. We already have media-related companies like GE taking taxpayer money that at least indirectly subsidizes things like multimillion dollar pay raises for Keith Olbermann. And the party in power these days directs its donors to give money to sites like Daily Kos, while those donors are seeking favor from government. I don't disagree that access is also a big lever of control, as it has been under many Administrations of both parties (although Obama's campaign at least was unusually zealous in that regard), but the financial nexus is already closer than it may look.