Assessing Audiences' Willingness to Pay and Price Response for News Online

Publishers are increasingly interested in charging audiences for access to online content as an alternative revenue stream. Past audience habituation to obtaining news online at zero cost means that successfully instituting paywalls is not a simple proposition. By applying uses and gratifications (UG) theory to audiences' consumption of news online, this study sought to answer two basic questions: What will motivate consumers to pay for access to news online? And, what will they pay? Using scales adapted from Papacharissi and Rubin (2000), van Westendorp (1976), and original measures, a survey was conducted in May, 2011, among a sample of online news users drawn from a commercial panel. The sample was balanced on key demographic variables to match known population parameters. A total of 980 usable interviews was obtained. Only 16% of respondents made any type of payment to access news content online during the 12 months preceding the survey. National, international and world news, and local news emerged as the top two content genres for which respondents reported paying. Among recent site visitors, however, travel- and business-related content were most paid-for. Payments for personal use overshadowed payments for business or joint usage. Barriers to paying included perceived ease and security of making payments, a lack of perceived value of online news offerings, and the wide availability of alternatives for which payment was not required. Exploratory factor analyses yielded six core types of gratifications obtained from online news sites: social, entertainment, information, identity, knowledge and cost. Past experience paying for content was most strongly related to both willingness to pay and acceptable price for access to content in the future. Although magnitude of gratifications obtained was positively related to prices respondents were willing to pay to access news, only the entertainment factor had a significant impact in predicting overall likelihood to pay. Overall satisfaction with a site was weakly related to willingness to pay, but did not impact acceptable price. Respondents did not perceive that a low price for access to content signaled low quality of content. Results were interpreted in the context of UG theory and market dynamics.Doctor of Philosoph