What Do News Aggregators Do? Evidence from Google News in Spain and Germany

Joan Calzada and Ricard Gil

Marketing Science, 2020, vol. 39, issue 1, 134–167

Abstract: The impact of aggregators on news outlets is ambiguous. In particular, the existing theoretical literature highlights that, although aggregators create a market expansion effect when they bring visitors to news outlets, they also generate a substitution effect if some visitors switch from the news outlets to the aggregators. Using the shutdown of the Spanish edition of Google News in December of 2014 and difference-in-differences methodology, this paper empirically examines the relevance of these two effects. We show that the shutdown of Google News in Spain decreased the number of daily visits to Spanish news outlets between 8% and 14% and that this effect was larger in outlets with fewer overall daily visits and a lower share of international visitors. We also find evidence suggesting that the shutdown decreased online advertisement revenues and advertising intensity at news outlets. We then analyze the effect of the opt-in policy adopted by the German edition of Google News in October of 2014. Although such policy did not significantly affect the daily visits of all outlets that opted out, it reduced by 8% the number of visits of the outlets controlled by the publisher Axel Springer. Our results show the existence of a net market expansion effect through which news aggregators increase consumers' awareness of news outlets' contents, thereby increasing their number of visits.

Keywords: news aggregators; Google News; market expansion effect; substitution effect; daily visits; engagement metrics (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormksc:v:39:y:2020:i:1:p:134-167

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