Well a free market works best, provided it is actually free. TV and Radio are NOT by any defintion free markets. If I had a billion dollard, I couldn't open a TV station in Chicago. Why? There are no allocations left. There are only so many stations per market. Pehaps I could buy a TV station? Yes, but that defeats the point, now we're back to the same number of stations, instead of a free market.
The free market will allow people to correct abuses, but if you allow people to compete and stifle competition it HURTS not helps.
You also have a thing called an "effective monopoly." This is where one company is so powerful they actually constrain business. Google and eBay are great examples of this. There is an actual free market there. But Google and eBay are so far ahead in their respective business models that it's nearly impossible to compete with them.
Informercials "serving the public interest" stem from "Home shopping channels" origins. In the early 1990s the FCC ruled that Home Shopping did indeed fill the public interest by providing alternative programing and helping the housebound to shop.
Prior to the FCC regulatations were slowly erroded away by the courts. The FCC used to have simple rules. Later on during the Reagan years, the courts told the FCC it's OK for you to have rules, but you have to have legitimate reasons to back it up.
So for instance the rule that said you can only have 15 minutes of commercials per half hour was discarded. Not because the courts objected, because the court said, unless you can say "WHY it has to be 15 minutes instead of say, 20 minutes/half hour or 10 minutes per half hour, you need to drop the requirement.
So slowly as companies challanged rules, if the FCC couldn't come up with a sound logical reason (in the courts opinion) on their rules, they had to drop them. During the 80s, if you look you'll find the FCC didn't try very hard to find a reason to back any of their rules up.
Now with the way TV works we have little diversity and even when a new start up company comes along we have simply more of the same opinion.