Is the internet bad news? The online news era and the market for high-quality news

Frijters, Paul and Velamuri, Malathi (2010) Is the internet bad news? The online news era and the market for high-quality news. Review of Network Economics, 9 2: 2.1-2.31. doi:10.2202/1446-9022.1187

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Author Frijters, Paul
Velamuri, Malathi
Title Is the internet bad news? The online news era and the market for high-quality news
Journal name Review of Network Economics   Check publisher's open access policy
ISSN 1446-9022
Publication date 2010-06
Sub-type Article (original research)
DOI 10.2202/1446-9022.1187
Open Access Status File (Publisher version)
Volume 9
Issue 2
Start page 2.1
End page 2.31
Total pages 31
Place of publication Berlin, Germany
Publisher Walter de Gruyter
Collection year 2011
Language eng
Abstract We review and model the impact of the internet on the production and uptake of highquality news. Our review of trends in the market for news suggests 3 stylized facts: i) particular quality news markets are dominated by merely a few providers, ii) demand for quality news appears stable, but provision of news has become specialized; mainstream news is decoupled from quality news, and iii) the dominant business model of internet news mirrors that of radio, television, and newspapers in that costs of news production are recouped via advertising. We build a stylized model that rationalizes these facts. Our model captures three conflicting effects: (1) economies of scale in the production of news lead to monopolies on particular markets, (2) easy access to information on the internet makes it cheaper to provide high-quality news and to disseminate it via the web, which increases the production of such news; and (3) the existence of bloggers and news aggregators who recycle the stories of news-providers reduces the effective property rights of high-quality news producers, thus forcing the business model of the internet to be advertising-based. For the most likely cases, our model would imply that the internet does not constitute bad news for the provision and uptake of quality news.
Keyword News quality
Search Costs
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ
Additional Notes Published Online: 29/12/2011. Article 2, pp. 1-31.

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2011 Collection
ERA 2012 Admin Only
School of Economics Publications
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Citation counts: TR Web of Science Citation Count  Cited 1 times in Thomson Reuters Web of Science Article | Citations
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Created: Mon, 06 Dec 2010, 16:49:50 EST by Alys Hohnen on behalf of School of Economics