Chomsky's model does not rely on a conspiracy for the media to function the way it does. It simply follows from incentives. Cribbing from the wikipedia article, we have:

The propaganda model for the manufacture of public consent describes five editorially distorting filters, which are applied to the reporting of news in mass communications media. These five filters of editorial bias are:

(1) Size, ownership, and profit orientation: The dominant mass-media outlets are large profit-based operations, and therefore they must cater to the financial interests of the owners such as corporations and controlling investors. The size of a media company is a consequence of the investment capital required for the mass-communications technology required to reach a mass audience of viewers, listeners, and readers.

(2) The advertising license to do business: Since the majority of the revenue of major media outlets derives from advertising (not from sales or subscriptions), advertisers have acquired a "de facto licensing authority."[11] Media outlets are not commercially viable without the support of advertisers. News media must therefore cater to the political prejudices and economic desires of their advertisers. This has weakened the working class press, for example, and also helps explain the attrition in the number of newspapers.

(3) Sourcing mass media news: Herman and Chomsky argue that "the large bureaucracies of the powerful subsidize the mass media, and gain special access [to the news], by their contribution to reducing the media's costs of acquiring [...] and producing, news. The large entities that provide this subsidy become 'routine' news sources and have privileged access to the gates. Non-routine sources must struggle for access, and may be ignored by the arbitrary decision of the gatekeepers." Editorial distortion is aggravated by the news media's dependence upon private and governmental news sources. If a given newspaper, television station, magazine, etc., incurs disfavor from the sources, it is subtly excluded from access to information. Consequently, it loses readers or viewers, and ultimately, advertisers. To minimize such financial danger, news media businesses editorially distort their reporting to favor government and corporate policies in order to stay in business.[12]

(4) Flak and the enforcers: "Flak" refers to negative responses to a media statement or program (e.g. letters, complaints, lawsuits, or legislative actions). Flak can be expensive to the media, either due to loss of advertising revenue, or due to the costs of legal defense or defense of the media outlet's public image. Flak can be organized by powerful, private influence groups (e.g. think tanks). The prospect of eliciting flak can be a deterrent to the reporting of certain kinds of facts or opinions.[12]

(5) Anti-communism/war on terror: Anti-communism was included as a filter in the original 1988 edition of the book, but Chomsky argues that since the end of the Cold War (1945–91) anticommunism was replaced by the "war on terror" as the major social control mechanism.

Also it must be remarked: calling Chomsky a conspiracy theorist? On hacker news? Come on, man. This is an extensively researched, respected, and cited work.