alt Hacker Newsi made this point a few comments up but i think what's happening to the software dev industry is what happened to the journalism industry when the web really came into its own and everyone was now a journalist. There were even books written by tech people about how great "creative destruction" is heh now the shoe is on the other foot. How many "old dinosaurs" did web development and software dev in general put out of business? My neck is on the line too but even i have to chuckle at that a little bit.
yep you're absolutely right. the value in journalism and journalistic output was based on the scarcity, i.e. the cost of publishing reduced the amount of available content. With web the costs were obliterated so the content exploded and the value of any individual piece dropped to essentially zero. When it's worth zero your revenues are zero and zero revenues you can't really pay for any journalism.
So then you have no choice but to seek alternative revenue streams (ads, data mining) and in fact this becomes the thing, since the original thing no longer produces a revenue.