They folded because they knew how the statement was perceived. Here is half the country flying flags half staff and ABC owners are defending Kimmel. They are worried about views and profits and when that is threatened everything goes out of the window.
Paradoxically, I think Kimmel is all of the sudden on top again, just due to the controversy. The younger crowd who don't sit and watch ABC, might have just learned about this Kimmel guy the first time. May be another network will pick him up, it could be a win for him overall.