Blacklock sues government and other publications for sharing their content as they want to maintain their content behind a paywall. It's deliberately not an open media outlet for broader public consumption, making it a terrible comparison to pubic media outlets (corporate or government owned). They may have found a model that works within a very narrow context, but it's also a model that would not work at scale within the capitalist media landscape.
Many news outlets do simply use government or corporate provided press releases as the competition for clicks is extreme and taking time to be more journalistic can undercut their ability to meet algorithms. Press releases are, however, only a portion of news content. CBC has their press room that largely reports on daily occurrences, but they also have teams of investigative journalists that produce articles critical of all levels of government and the parties therein. It's not either/or.
I am all for media regulation reform that will place more emphasis on distributed, independent, and local media journalism. I very much supported the digital services act, as it sought to overcome the challenges that local media faces, where it's content is used for the profits of Google, Facebook, etc. without compensation. How are local outlets expected to function when they largely being stripped of any revenue function? Other than subscription based models that are highly susceptible to corporate control and/or buyout, how do you propose we fund a this independent and local media while ensuring reporting can be held to acceptable levels of accuracy and fairness?