I think you're right. I work in the publishing industry, and advertising is everything. The magazine I work for right now (Windows & .NET Magazine) is a paid book, but we still needs lots of ads to make money. With the tech slump of the last few years, we've really suffered. All the trade magazines have. Tech companies just don't have the money for advertising right now. I've worked on the other side, too--marcom, where I started out at the beginning of the year with a nice fat budget for advertising, sales literature, etc., and within six months half of it was slashed.
The first magazine I worked for after college was GIS WORLD Magazine. (That's where I first learned about GPS 15 years ago. I got to write really fun articles about a topic very few people knew about.) GIS WORLD was a start up when I began working there. We started publishing at just the right time; a year later and it would have been too late. Timing is everything in this business. And one thing I've learned in this business in the past few years is that print publishing is evolving. You have to have a lot of other businesses to support your print publications. We do everything--electronic newsletters, huge web site, roadshow seminars, web seminars, eBooks... Even then, it's been tough the past three years. It would take a lot of guts to start a new magazine right now.
Nevertheless I'd LOVE to work for a geocaching magazine, so if anybody can get the start-up capital together and line up some subscribers and advertisers, let me know!!! I have an impressive resume.