The problem with the "follow the money" thesis is that Hollywood for YEARS has had overhwleming evidence that a "G" rated movie on average makes a lot more money than a PG or R. Yet Hollywood does not want to make "G" rated movies. This is the point of Medved's book, "Hollywood vs. America." It't not just about money. It's about being perceived as "hip," liberal, and "with it."
I agree with Medved. But movies aren't as advertiser driven as networks and newspapers. Once the advertising dollars leave, newspapers have no means of support.
Hollywood has managed to make enough money to stay solvent, even with their production of tripe. But you have to agree it's getting harder and harder for them to stay afloat.