"It used to be that you needed The Advocate to know what's going on in gay politics," Mr. Evans said. "Today, you have the internet and even The New York Times."
The political and social goals that initially spurred many gay-media companies were eroded by the profit motive, Mr. Evans said. "It used to be, every [company] had a dollar and a dream. But gay media grew, and then suddenly it became about the business. They toned down content to get national advertisers and then lost readership."
Last fall, Logo shut down one of its gay-focused news blogs, 365gay.com, signaling the network's departure from the news-media business. "There are other [news outlets] that can do that better than we can," Ms. Sherman said. Though Logo still operates popular gay-entertainment blogs, including AfterElton.com and AfterEllen.com, Ms. Sherman said it had no plans to alter their content—though the coverage may become "more broadly gay-centric" along with the rest of the network, she added.
Aaron Hicklin, who edits the national gay men's glossy Out (which boasts a reported 200,000 circulation and is celebrating its 20th anniversary this year), has noticed the changes in the market and in readers in recent years. He himself is no stranger to criticism for using nongay (or even, more controversially, closeted) subjects on the cover, and he famously took pop star Adam Lambert's management team to task for insisting that his 2009 cover concept not read as "too gay."
It isn't gay-media's job to produce only gay-focused content, Mr. Hicklin said, but to maintain a gay perspective on content. That's something mainstream publications aren't doing.
"The argument these days seems to be that The New York Times does a lot of gay stuff, and so does New York magazine, and Gawker is by default a gay website," Mr. Hicklin said. "There is great coverage in all those [places], but there are often things that are missed just because they're not looking at the world through a gay prism."
When Manhattan's St. Vincent's Catholic Hospital closed its doors in 2010, it received plenty of mainstream media attention. But Out (whose parent company, Here Media, also owns The Advocate) featured an oral history highlighting the institution's groundbreaking role in AIDS research and activism, including interviews with dozens of nurses, patients and others who lived through the crisis during the "80s and "90s.
"No one wrote that story, but we did," Mr. Hicklin said. "Gay media's role is not just to talk about our culture but also to acknowledge and celebrate our shared cultural antecedence—our history. We don't get that from our parents, and that 's unique to LGBTs."
Though that social mission may be a relevant goal for magazines and newspapers, Mr. Shellhammer said, it often takes a back seat at other kinds of media companies, as it did with Fabulis. "There is an energy that is alive in the heart and soul of the gay experience, but I don't think you can build a business around that ," he said. We found it really hard to do."
It's estimated that there are 16 million gay consumers in the U.S. and they spend $845 billion a year, according to Prime Access' data. Though the demographic is diverse, marketers and consumer experts have pegged gay men and women—and particularly urban LGBT two-income households without children—as having disposable incomes that are higher than average. And while they are a smaller minority market than Hispanics or African-Americans, gays are recognized influencers and early adopters.
Analysts agree that gays are a great target for brand growth, but as gay-media companies evolve and their audiences "integrate," it could get tricky for ad agencies that specialize in LGBT marketing.
Craig Karpel of The Karpel Group said TV is an increasingly less effective way to reach gay consumers. His marketing agency targets that audience through event and nightclub promotions, street initiatives, blogs and social media.
"The way gay people want to be entertained and the way they need to be marketed to are two very different things," Mr. Karpel said. "Advertisers can go to them as part of their mainstream campaigns, but if they want targeted [gay-specific] marketing, TV is not the best place to reach them."
For Prime Access (a full-service multicultural agency with a client roster that includes Pfizer, GlaxoSmithKline and American Express) the reality is that Logo remains one of the only mass-media opportunities to reach a gay audience with gay-specific creative—whether or not straight people are watching.
Mr. Evans at Rivendell said that smaller ad budgets have made "gay-vague" creative (including subtle targeting that many straight consumers might miss) a thing of the past. Instead, LGBT-conscious marketers are either sticking to their mainstream campaigns or tailoring creative to fit well in gay media.
"Logo gives you license without explanation to deliver a gay-specific message," said Prime Access' President-CEO Howard Buford. "And it's been true since the "90s that gay consumers respond more strongly to advertising that portrays them directly for who they are and how they live their lives."
Gay-specific creative has shifted along with the audiences, who expect more depth in messaging aimed at them, Mr. Buford said. Though TV remains an integral part of the story, he added, digital-media channels increasingly allow for the best targeting capabilities.