This is fundamentally wrong. It's subsidized (largely by advertising), not naturally cheap. It's like looking at Google and saying "man, software development must be cheap, they're giving away this search engine!"
Good reporting is time and labor-intensive. It also has an extremely short shelf life, meaning the time available to extract value is limited. A single news story is financially valuable for a very short period of time.
Again, compare the cost of a news story vs many other things. Advertising campaigns are also time and labour intensive and usually only provide value for a short space of time. Yet people who do advertising work often earn more than journalists. News is simply not labour intensive, especially given that the vast majority of stories are not investigative and require nearly no effort to put together. Plus, the labour isn't well paid.
You haven't supported your argument all that well. First of all, ads have a significantly longer shelf-life than news stories and can often be re-used. Even short-term ads have value for weeks.
Second, creating a single, non-"investigative" (this is a nebulous term in this context) story takes, typically, 20-40 man hours to create and has value for typically 24 hours. 40 hours is in itself relative as a measure of cost, but against the term for recouping costs, it's very expensive. Without ads, this wouldn't be a viable business.