Free lunch for all? – A path analysis on free mentality, paying intent and media budget for digital journalism

ABSTRACT

The advertising-based business model of journalism is under massive economic pressure. Thus, paid online content is becoming increasingly important for publishers. However, most consumers refuse to pay for online content at all. “Free mentality,” the consumer’s aversion to accept any price point other than zero, is discussed as one major reason. This paper is the first to empirically examine whether free mentality is associated with a reluctance to pay for online news. For this purpose, data of a comprehensive user survey in Germany (n = 1,004) was analyzed via ordered probit models and path analysis. Additionally, moderating effects with regards to free mentality and perceived value were examined. Results confirm low paying intent in the public and the role of free mentality therein. Beyond, free mentality significantly moderates the effect of perceived value on paying intent. The ideal of the Internet as disseminator of free ideas has a strong indirect effect on paying intent. Additionally, mandatory public service media fees in Germany pose another possible context-dependent rationale. This implies that the audience tends to perceive generic online goods akin to public goods. Thus, publishers must focus on the paying minority and the creation of added value via sufficient differentiation.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Data availability statement

The data that support the findings of this study are available from the corresponding author, D.O., upon reasonable request.

Supplementary material

Supplemental data for this article can be accessed on the publisher’s website

Additional information

Funding

This work was supported by the Volkswagen Foundation under Grant 94903.

Notes on contributors

Daniel O’Brien

Daniel O’Brien (born Kunkel) is a research assistant at the Schmalenbach School of Business & Economics (TH Köln University of Applied Sciences). Before, he was a research assistant at the Professorship of Media and Technology Management at the University of Cologne, where he still works on his Ph.D. He worked at the department on a third-party funded project (by Volkswagen Foundation) on digital entrepreneurial journalism.

After finishing his degree in Political Science and Philosophy (B.A.) at the University of Münster, he studied Cognitive Science (M.Sc.) at the University of Bochum and graduated with a thesis on neural networks in economic game paradigms. Simultaneously, his media interest led to internships and jobs in publishing and online journalism. Finally, he finished a second B.A. in film directing at the international film school of Cologne, where he worked as a Teaching Assistant at the Professorship of Applied Media Studies. In addition to his academic interests, he still works in the media business and on future scripts.