The Design Towards a News Aggregator Subscription Service: Results from An Online Experiment

Kazan, Erol
Tuunanen, Tuure
Ghanbari, Hadi
Li, Mengcheng
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The newspaper industry is on a quest to discover sustainable business models. Digital subscriptions are stable revenue generators for most publishers. That being said, smaller publishers face challenges. By not having the same resource base to offset costs compared to larger ones, small publishers are in a constant state of financial unpredictability. Another persistent problem among them is the high churn rate of subscriptions (i.e., the cancelation rate), which suggests a value misalignment between readers and service. New services like news aggregators may promise publishers a large pool of paying readers, as readers have access to diverse content by different publishers and are willing to pay for pooled news content. But platform fees and the disintermediation of direct customer relationships enact barriers for many publishers. To address these shortcomings, this study conducts an online experiment based on design science research to test the performance of different payment plans for a collaborative news aggregator service. We identify preliminary design principles for value creation and capture, which can be utilized for designing a commercial and collaborative news aggregator service.
Advances in Design Science Research, business model, design science, newspaper industry, strategic alliance, subscription
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