I think in their quest to take on conservative talk radio, they simply made one fatal mistake. They overestimated their demographics. Apart from the real lefty types, I have a feeling that most "democrats" vote that way because that's what they think they are supposed to do. Since democrats are cool and republicans are a bunch of greedy old geezers. They probably knew that there wasn't much of a market, but pushed forward anyway in a "build it and they will come" sort of fashion. They took a huge risk, the odds were not in their favor, and they are now realizing the mistake.
Like good little liberals, they will, of course, refuse to believe that no one really listens to Air America. They will come up with all sorts of conspiracy theories about how the broadcasting corporations have it in for them(cause corporations are evil), or Rove/Bush/Cheny/Halliburton are suppressing them, or some other crckpot, tinfoil hat scenarios.
One more step towards the total self destruction of the Democratic party. I can't wait!