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What you describe is a big part of it, but it's only part. The other big thing that happened is the near-total loss of ad revenue. Facebook built really good microtargeting, so that it became more cost-effective to advertise on their product to reach a local audience than to advertise on local news outlets, and Craigslist did the same for classifieds.
The result looks like this for most outlets:
Subscriptions are only a partial workaround for some news outlets; you can't actually charge a subscription for most local news — not enough people can pay it to result in a viable publication.
In any case, this loss of revenue means that the typical local outlet can't afford anything like the level of reporting they had 20 years ago.
The capitalist model is failing the journalism industry. Is there a way to build a mutual aid network for good journalism?
What caused the failure was everyone thinking everything should be free
That is the cycle of enshittification: give things away free at first, find ways to get indirect revenue from that by selling your users once the network effects kick in, and then in the end, raid the whole company for the primary shareholders.
It's a new economic model peculiar to late stage capitalism, and it's like an engine that drives loligarchy. Chucklefuck rich white boys who don't realize a little learning is the most dangerous thing of all.