The online advertising merchants realized they could "curate" and "summarize" the articles, resulting in far fewer ad impressions than if someone had to find things purely through the publication newspaper, and bring the ads forward to their portal instead of solely on the content itself.
AND they capitalized on an early reluctance to charge for things online to push the "ew, who wants to pay" mindset globally.
Newspapers didn't understand that their own business model wasn't two separate modes of "journalism" and "advertising" until it was too late. They were always in the relevant information (both news and advertising) business, so Google SUPER ate their lunch. Many news organizations died and some limp along not knowing this, but the industry as a whole was fat and complacent. There was a lot of money in newspapers, especially before it was legal to own multiple news sources. Local newspapers being able to fly reporters to major national events type of money (in private jets for the larger ones).
I spent a few years at one of the larger surviving independent statewide papers in the US as part of a team specifically hired to "fix" the subscriber and advertiser losses. They told us the scope was business-wide, but in reality all leadership wanted was someone to tell them that they're smart, special people who just need to use manipulative tactics harder. Nonprofit and community focused papers are springing up, and doing well, but some old timers are holding out for something around the corner that will magically return them to 1000%+ profit margins instead of learning how to be a normal business since they missed their chance to be Google.
It's not the web. It's democratization. And unfortunately, people would rather watch dancing cats then pay someone to tell them what their local county is doing. That's called consumer choice and fighting it is like fighting nature.
(2) People psychologically struggle with paying for something non tangible.
There is more to it than wanting free stuff. At least for some of us.
I have never subscribed to newspapers. If I wanted one, I would go to the convenience store or find a newspaper box. Why? Newspapers sold subscriber lists. I realized early on that online news sites would do the same, only they would have far more valuable data: they would know what interested me from what I read. So instead of being the target of advertising, I would be the target of targeted advertising.
(It also doesn't make sense from a convenience perspective. Newspaper subscriptions offered convenience through home delivery. News sites offer the, admittedly minor, inconvenience of managing accounts.)
Like why not lay the smack down to all the illegal shit exposed by the panama papers, and put the money toward real investigative journalism outfits? Oh right because there are no consequences, and if there were they would never put the money in the right place.
For example, there are a few youtubers who do a great job but their appeal is global - or at least the entire english speaking population. The scope of focus is “interesting conspiracies that are true” or “some product everyone wants”. Not a serious investigation into the misallocated funds in the local county.