The counterculture movement was by the mid 1970s co-opted into the mainstream. This is evident enough in Hollywood films adopting a radical and experimental style, taken from the avant-garde, within their otherwise standard narratives. A good film to look at is Easy Rider to see this in action. Another interesting film is the Exorcist. There is a scene in the Exorcist where there is a protest being filmed within the movie itself--a film in a film. The metaphor is clear, that of the protest movement being fully enveloped within the master narrative of Hollywood itself. You have on the other hand film makers like Kenneth Anger, who were making underground short films up into the 1960s. There is and always will be an underground, it is just that the counterculture was mobilized. An entire generation, the baby boomers, appeared to be resonating the same desires for change.
The counterculture was a large-scale mobilized force that generated much of its energy and enthusiasm from the underground cultures in the 1960s. It lasted only a short time as a real movement. The mainstream culture picked up the ideas that it was advertising, and then re-packaged and sold them. I'm not going to judge whether or not the product that came out the other end of this transaction was good or bad, of value or vapid. Certainly something changed, and that is the nature of society, to change and not be static. That said, the underground continues to exist, unfettered by coercive commercialism, but in a state of fragmentation. And this fragmentation is commonly seen as symptomatic of the postmodern era.
The mainstream media caters to a class in society that can be referred to as bourgeois--the middle class and richer. It seems like the thing about the US is that it tends to consider itself a classless society. The myth of the American dream is a romantic tale of rags to riches. Anybody can be anyone. But mainstream culture is packaged and produced to be consumed by bourgeois tastes. These tastes are based on the representation of a certain kind of lifestyle, and the media sells this lifestyle to the people who have the money to buy the products. You don't see sitcoms about hobos on network prime time. The main concern is to question whether what is taken from the underground, co-opted into mainstream culture as such, retains its original cultural currency or not. A cultural entity has sold out when it loses its currency, agency, or autonomy, through being diluted and subsumed within a hegemonic system. This happens quite frequently, however it is not the rule.