Paywalls and the demand for online news

Frode Skjeret (), Frode Steen and Timothy G.A. Wyndham ()
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Frode Skjeret: SNF
Timothy G.A. Wyndham: Dept. of Economics, Norwegian School of Economics and Business Administration, Postal: NHH, Department of Economics, Helleveien 30, N-5045 Bergen, Norway

No 7/2019, Discussion Paper Series in Economics from Norwegian School of Economics, Department of Economics

Abstract: The digitisation of society has posed a challenge to news outlets. Seeking advertising revenues and facing competition for the attention of their readers, many news outlets entered the digital era with unrestricted access to their online content. More recently, news outlets have sought to restrict the amount of content available for free. We quantify the impact of introducing a paywall on the demand for news in Norway. The short-run average impact of a paywall is negative and between 3 and 4%, in the long run the effect increases to between 9 and 11%. We find heterogeneity in the response to paywalls. The largest news outlet within its market experiences larger effects than the other news outlets. After introducing a paywall, the largest news outlets face a long-run reduction in demand between 13 and 15%, as compared to the others who experience a decrease of between 8 and 11%. The timing of introducing a paywall does not seem to affect the demand response very much.

Keywords: Online news; paywalls; business models; two-sided markets (search for similar items in EconPapers)
JEL-codes: D40 L20 L82 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2019-05-22
New Economics Papers: this item is included in nep-com, nep-cul, nep-ict and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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