Some have had enough, packed up and moved on. Others have downsized and adopted new strategies to survive and prosper once again.
There are also stories of hope and redemption, of Indigenous Australians taking control of their own destiny.
But the hard truth is that the number of holiday visitors to Central Australia in the 12 months to September 2011 fell 10%.
Hardest hit is Alice Springs, where there is blunt talk of a town at the cross roads.
It’s still relatively prosperous, but its character is changing.
Time-poor tourists are choosing to bypass ’The Alice’ and fly straight to Yulara where they can see the world‘s biggest monolith at Uluru, also known as Ayers Rock, and the dramatic rock formations at Kata Tjuta (The Olgas).
Virgin and Tiger Airways have both pulled out of Alice Springs, leaving the market to Qantas.
This has had a dual impact. Overall passenger numbers are down and the lack of competition means airfares are expensive, as they are in any monopoly situation.
“The situation here is very bad indeed,” says Publisher of Alice Springs News, Erwin Chlanda.
“We’ve had a lot of shops closing in Todd Mall, which caters mainly to tourists, and I recently spoke with a tour operator who used to have 14 employees and now it’s just himself.
“It’s usually attributed to the high dollar or perceived racial tension and law and order issues, which are quite often exaggerated.
“There’s a lot of anxiety that is unnecessary.”
Owner of Outback Ballooning, John Sanby says that “things are all doom and gloom around here – I feel like a record player going round and round.”
He confirms that “about three years ago it started to fall apart” for the Alice Springs tourism industry.
Back then Outback Ballooning employed 20 to 25 people. Now it has six employees.
“The main thing is lack of access,” says Mr Sanby.
“The Qantas flights here are full of bureaucrats or miners – there aren’t many tourists.
“I’ve had about 80-odd travel industry customers writing me letters saying thanks for all your fantastic services but we are not coming here anymore.
“I am talking about companies like TUI that have thousands of travel agencies around Europe.”
As a result Mr Sanby says “a lot of operators have just left, packed up and gone.”
But Mr Sanby is staying in Alice Springs and recently obtained permission from the Central Land Council to start flying balloons over Uluru from March 1.
“I am lucky because I anticipated this, I thought ‘I have to follow my clients’.”
And that that is to Ayers Rock, 470km to the southwest of Alice Springs, where tourism is also down but not quite to the same extent.
Parks Australia statistic show there were 8 per cent fewer visitors to Uluru National Park in 2011 compared to 2010.
Koos Klein, Managing Director of Voyages Indigenous Tourism Australia, which owns and operates Ayers Rock Resort and the nearby Longitude 131 luxury camp, says aggressive domestic marketing helped compensate for a slump in international business in 2011.
“Looking back at last year we more or less got what we expected and had planned for with overall occupancy 1.6 per cent below budget,” Mr Klein says.
“So that’s not a dramatic fall and if you look at domestic business it was way up with a 20 per cent increase over 2010.”
This has changed the guest mix across Sails in the Desert Hotel, Desert Gardens Hotel, The Lost Camel Hotel, Emu Walk Apartments, Outback Pioneer Hotel & Lodge and Ayers Rock Campground.
Business is now 55 per cent domestic, 45 per cent international – a direct switch on what it would have been in previous years.
He believes the key European and Japanese markets will bounce back and – like the rest of Australian tourism – holds great hopes for Chinese visitors.
“China is an infinitesimal part of our business at the moment but I believe there’s a future in it for us.”
Ayers Rock Resort is also building a new conference facility to make it more attractive to the key meetings market.
On other benchmarks, Mr Klein says Ayers Rock Resort, ultimately owned by the Indigenous Land Council, is performing well, employing 77 aborigines compared with just two when ILC bought it from the General Property Trust last May.
Meanwhile, there’s further good news with the launch of Uluru Aboriginal Tours which is employing a further 35 locals as guides and interpreters, filling a void left by the recent controversial closure of Anangu Tours.
Manager John Sweeney says all involved are stakeholders in the business and that the future looks bright.
“It’s a nice place to be,” Mr Sweeney says. “As they say, the Rock is going nowhere one day at a time.”