One thing not to be discounted is the strength of the relationships that these PR and public affairs firms have forged with media outlets over the years. These kinds of relationships have not yet been built between PR firms and new media companies yet, though it should be noted that many online news outlets have not yet been around long enough for these sorts of ties to grow organically the way that they have with broadcast and print media over a period of decades.
Nonetheless, the same technologies that many predicted would put traditional PR firms out of business and put a lot of long time professionals out of their PR marketing jobs, public affairs jobs and public relations jobs have been eagerly adopted by traditional firms. Many of the same blogs, websites, social bookmarking platforms and the like are now working side by side with PR firms and these Web 2.0 technologies are now being used by the very firms that these platforms would make unnecessary according to the conventional wisdom.
As we all know, the conventional wisdom may be relatively reliable, but no one bats 1000 and those who spread dire predictions about the future of traditional public relations didn't count on the industry's long standing approach of embracing new technologies and availing itself of new opportunities. Essentially, it was a failure to understand the nature of the industry - and if you'll think back, very few of these writers predicting the death of public relations as we knew it were themselves involved in the industry.
The heart of public relations jobs and public affairs jobs is to leverage the power of the media to get out the client's message; as such, new media are a cause for celebration, not despair. There are always a few firms who fail to adapt to the facts on the ground as they change, regardless of the industry - but public relations is definitely no more prone to this than any other field.
New technologies are being used at traditional firms, with old hands learning how to use new media effectively and all new PR marketing jobs are being created for a younger, tech-savvy generation of PR professionals who know how to get the message across as well as being intimately familiar with new, largely online technologies. Older PR strategies like press releases have found new life online and many in the world of PR are finding blogs and micro-blogging platforms to be incredibly useful tools. It's not that traditional PR is down and out but rather that it is evolving, right along with the rest of the world.