The imperative of localism and local news
Both might be equally blamed on the turn from community news to more professionally produced political and process coverage by newspaper staffs. I call this "Castor oil" coverage, as in "we think this is important and we don't care whether you, dear reader, agree -- take it and don't whine about it."
(And note, too, readership declines started before newspaper chains became massive entities and were often publicly traded, so readership losses are not necessarily an ownership problem, either.)
Of course, to me, the business model and the journalism model are one and the same. Revenue declines are closely related to readership declines, so we must fix readership before we can fix revenue.