You are forgetting though (in this Walmart example) that Walmart provides volume. And volume drives down your costs. A big customer may very well be a necessary evil that you can't avoid.
Manufacturers are also known for selling the same (or slightly different or even inferior) product through multiple channels in order to drive down costs. (And example might be Sears private labeling washing machines manufacturered by Westinghouse).
"Demand Media made was creating a lot of crappy content"
Agree with that.
"shitty news" has entertainment value. People read shitty news because it's entertaining. If it's not accurate that is not the same problem as crappy instructions on how to fix a leaky roof (where the goal is to solve a problem not be entertained.)
The mistake Demand Media made was creating a lot of crappy content. They weren't delivering much user value; their real skill was search-driven eyeball arbitrage. When Google tuned their search engine to deliver more value to their users, Demand got squeezed out and had nothing to fall back on.