News Media Channels: Complements or Substitutes? Evidence from Mobile Phone Usage

Abstract

The media industry has undergone a fundamental shift over the last decade as new online distribution channels have proliferated in an unprecedented manner. Although mobile devices have experienced rapid adoption among consumers, their effect on consumer behavior and their subsequent implications for publishers and advertisers have yet to be understood. The authors examine consumers’ news consumption behavior on mobile news websites in response to the introduction of a mobile news app. Pseudo-panel analysis based on repeated cross-sectional data suggests that the introduction of a mobile app by a major national media company leads to a significant increase in demand at the corresponding mobile news website. In addition, the authors report that this effect is greater for consumers with higher appreciation for concentrated news content, with stronger propensity for a particular political viewpoint, and with fewer time constraints. The results are consistent with the interpretation that adoption of a provider’s news app stimulates corresponding mobile news website visits. The authors discuss the implications of these findings for advertisers, media publishers, and policy makers.

Keywords: online media consumption, mobile news app, mobile news website, complementarity, pseudo panel analysis

JEL Classification: C2, C23, C3, C33, M3, M31, M37, D1, L6, L63, L68, L86