If we accept that mankind is generally on the right track (though it sometimes takes a roundabout way) and things on the whole are developing for the good, then we must also accept news is either going to be needed and have a future or become obsolete and die off. There’s nothing we could do about changing the direction of evolution: and why would we.

But that’s just pseudo-philosophic blabber. You’re right; the news industry (as in: its managers) doesn’t really believe its content has any value other than to provide structure around which to place advertising.

Anyway, if I’d have been right I’d have suggested newspapers in cafes, etc are similar to radio played in cafes as the advertising pays of them. In fact it’s more attractive to advertisers to have more readers than purchasers, no?

But I’m not right because the music recording industry is really weird and not something you can usefully use for analogies.

As for the value of news, I think everyone knows that 50p or whatever per paper doesn’t equal the cost of gathering that news. As an outsider I’d guess it’s something like 10% sales, 90% advertising? So while the true cost of the paper might be £5 there’s no way I’m going to pay that on a daily basis. (I might, however, pay that for something like The New Yorker every week. But only offline with the cover art being a major draw.)

Which brings us to subsidies. Assume you saw this:
http://www.guardian.co.uk/commentisfree/cifamerica/2009/feb/12/newspapers-investigative-journalism-endowments

The idea is flawed in a number of places (not least that good solid reporting isn’t always popular) but at least there’s a president. The news gathering part of your industry has been subsidised by the advertising gathering part for decades. Switching to another form of subsidy shouldn’t be conceptually hard.