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Paywalls and the demand for news

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  • Chiou, Lesley
  • Tucker, Catherine

Abstract

Given the preponderance of free content on the Internet, news media organizations face new challenges over how to manage access to and the pricing of their content. It is unclear whether content should be free or whether customers should pay via a “paywall.” We use experimental variation from a media publisher’s field test of paywalls to examine demand for online news across several local media markets. We find a 51% drop in visits after the introduction of a paywall and a far larger drop for younger readers.

Suggested Citation

  • Chiou, Lesley & Tucker, Catherine, 2013. "Paywalls and the demand for news," Information Economics and Policy, Elsevier, vol. 25(2), pages 61-69.
    • Handle: RePEc:eee:iepoli:v:25:y:2013:i:2:p:61-69
    DOI: 10.1016/j.infoecopol.2013.03.001
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    1. Matthew Gentzkow & Jesse M. Shapiro & Michael Sinkinson, 2011. "The Effect of Newspaper Entry and Exit on Electoral Politics," American Economic Review, American Economic Association, vol. 101(7), pages 2980-3018, December.
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    Cited by:

    1. Monsalve-Alamá, Antonio & Ortigosa-Blanch, Arturo & Sánchez-García, Javier, 2023. "The evolution of the media discourse on the implementation of media companies' new digital business models," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    2. Inyoung Chae & Jihyeon Ha & David A. Schweidel, 2023. "Paywall Suspensions and Digital News Subscriptions," Marketing Science, INFORMS, vol. 42(4), pages 729-745, July.
    3. Jian Pei, 2020. "A Survey on Data Pricing: from Economics to Data Science," Papers 2009.04462, arXiv.org, revised Nov 2020.
    4. Bertin Martens & Luis Aguiar & Estrella Gomez Herrera & Frank Muller, 2018. "The digital transformation of news media and the rise of disinformation and fake news," JRC Working Papers on Digital Economy 2018-02, Joint Research Centre.
    5. Casarico, Alessandra & Tonin, Mirco, 2018. "Pay-What-You-Want to Support Independent Information: A Field Experiment on Motivation," IZA Discussion Papers 11366, Institute of Labor Economics (IZA).
    6. Charles Angelucci & Julia Cagé, 2019. "Newspapers in Times of Low Advertising Revenues," American Economic Journal: Microeconomics, American Economic Association, vol. 11(3), pages 319-364, August.
    7. Steen, Frode, 2019. "Paywalls and the demand for online news," CEPR Discussion Papers 13651, C.E.P.R. Discussion Papers.
    8. repec:hal:spmain:info:hdl:2441/4edekc99or8n2bu86nu4ua8adl is not listed on IDEAS
    9. Robert Rußell & Benedikt Berger & Lucas Stich & Thomas Hess & Martin Spann, 2020. "Monetizing Online Content: Digital Paywall Design and Configuration," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 62(3), pages 253-260, June.
    10. Anja Lambrecht & Kanishka Misra, 2017. "Fee or Free: When Should Firms Charge for Online Content?," Management Science, INFORMS, vol. 63(4), pages 1150-1165, April.
    11. Ben Shiller & Joel Waldfogel & Johnny Ryan, 2017. "Will Ad Blocking Break the Internet?," NBER Working Papers 23058, National Bureau of Economic Research, Inc.
    12. Stefano Castriota & Marco Delmastro & Mirco Tonin, 2023. "National or local infodemic? The demand for news in Italy during COVID-19," International Journal of Health Economics and Management, Springer, vol. 23(4), pages 507-536, December.
    13. repec:hal:spmain:info:hdl:2441/26t617gatp86qree1dejcpchbr is not listed on IDEAS
    14. Casarico, Alessandra & Tonin, Mirco, 2021. "A field experiment on fundraising to support independent information," Journal of Economic Behavior & Organization, Elsevier, vol. 186(C), pages 227-250.
    15. Chutian Wang & Bo Zhou & Yogesh V. Joshi, 2024. "Endogenous Consumption and Metered Paywalls," Marketing Science, INFORMS, vol. 43(1), pages 158-177, January.
    16. Alfonso Vara-Miguel, 2020. "Cross-National Similarities and Differences between Legacy and Digital-Born News Media Audiences," Media and Communication, Cogitatio Press, vol. 8(2), pages 16-27.
    17. Xiaojie Sun, 2023. "Strategy analysis for a digital content platform considering perishability," Annals of Operations Research, Springer, vol. 320(1), pages 415-439, January.
    18. Anja Lambrecht & Avi Goldfarb & Alessandro Bonatti & Anindya Ghose & Daniel Goldstein & Randall Lewis & Anita Rao & Navdeep Sahni & Song Yao, 2014. "How do firms make money selling digital goods online?," Marketing Letters, Springer, vol. 25(3), pages 331-341, September.
    19. Abdallah Salami & Robert Seamans, 2014. "The Effect of the Internet on Newspaper Readability," Working Papers 14-13, NET Institute.
    20. Adithya Pattabhiramaiah & Eric Overby & Lizhen Xu, 2022. "Spillovers from Online Engagement: How a Newspaper Subscriber’s Activation of Digital Paywall Access Affects Her Retention and Subscription Revenue," Management Science, INFORMS, vol. 68(5), pages 3528-3548, May.
    21. Stephanie L. Chan, 2021. "The Social Value of Public Information When Not Everyone is Privately Informed," Working Papers 2021-09-18, Wang Yanan Institute for Studies in Economics (WISE), Xiamen University.
    22. Kim, Ho & Song, Reo & Kim, Youngsoo, 2020. "Newspapers' Content Policy and the Effect of Paywalls on Pageviews," Journal of Interactive Marketing, Elsevier, vol. 49(C), pages 54-69.
    23. Anderson, Simon & Waldfogel, Joel, 2015. "Preference Externalities in Media Markets," CEPR Discussion Papers 10835, C.E.P.R. Discussion Papers.
    24. Julian Runge, & Stefan Wagner & Jörg Claussen & Daniel Klapper, 2016. "Freemium pricing: Evidence from a large-scale field experiment," ESMT Research Working Papers ESMT-16-06, ESMT European School of Management and Technology.

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