Sounds like a firing / soft firing / come to jesus moment about the viability of the business...
Pretty much. It's fun seeing idealists get slapped by reality. If you want to protect your ideals you better know how to fight for them using the same tactics as your competitors.
Learning how to build a board that is in your favor, making alliances with less than pure players if needed, and being ruthlessly competitive allows an ideal to become reality.
They could have launched paid subscriptions, they even said they were looking into it, crickets...