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The Digital Newspaper: Proposing a business model for Wegener, when offering digital content on e-Readers

Tunc, Amanuel (2010) The Digital Newspaper: Proposing a business model for Wegener, when offering digital content on e-Readers.

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Abstract:This research has been done for Wegener, a Dutch publisher of regional and local newspapers, in order to see if e-Readers can be used. Because news is becoming available for free, Wegener is seeking new ways of offering content. Devices like e-Readers can be a nice way of offering content to customers. The research will show where to focus on when content is being offered on e- Readers, and how revenue can best be appropriated. In this research, the following main research question was formulated: What (combination of) business model(s) creates the most value for Wegener, when it delivers its content on e-Readers to its customers? This question was divided in four sections, each with a sub question: 1. What is the behavioral intention of readers of newspapers to use an e-Reader as a replacement for the printed newspaper? 2. How can Wegener create most value, when offering content via e-Readers to its customers? 3. How can Wegener deliver most value to its customers, when offering content via e-Readers? 4. How can Wegener appropriate most value, when offering content via e-Readers to its customers? For the first sub question, the UTAUT model was used. This is a technology acceptance model that tries to explain what the intention and usage behavior of users is when using a new technology. This model shows that behavioral intention of consumers to use an e-Reader as a replacement for the printed newspaper will increase the most if consumers perceive e-Readers as useful and usable devices to read the news(paper) with. Next to that, e-Readers should also be quick in reading the news(paper) digitally. Other factors like influence from the social environment or the ease of use of e-Readers have a less effect on the behavioral intention. For the process of value creation, it is clear to see that the focus should remain on regional and local news, because this is the biggest value for the customer. There are not many newspapers in the Netherlands that offer that kind of news. The results of the online questionnaire also show that the willingness to pay for digital regional and local news is the highest compared to other forms of digital news. It is also important to look at personalized news, which means that customers can select which news they want to receive and therefore only pay for the news that they want. The willingness to pay for this kind of news is a bit lower than for regional and local news. For the process of delivering value, when looking at certain customer needs, the results of this research make clear that respondents don’t think that textual news is enough. They also want to see photos and videos. However, they find it important that the text is pleasant to read, even when they receive photos and videos. So at this moment, e-Readers are not good enough to please these customer needs. They are still only capable of showing black and white text and no photos and videos. It is best for Wegener to wait for better e-Readers that can show color and are able to show photos and videos. Only then, these customers needs can be pleased. According to The digital newspaper: Proposing a business model for the newspaper industry the results of the online questionnaire, the willingness to pay for news on an e-Reader is lower than news on other mobile devices (photos/videos). The above described customer needs already showed that the respondents want to see photos and videos on their screen, when receiving news. When appropriating value, it has been clear that subscriptions are still being preferred more than small amounts per article. It’s because subscriptions are easier for customers and according to the white papers, an easy payment method is important for customers. At this moment, transaction methods for small amounts per article are still not attractive enough for companies, because transaction costs are too high. To attract customers for subscriptions, a free trial period is very important. When the customer doesn’t own an e-Reader yet, giving an e-Reader for free with a subscription can also be a nice way of attracting customers. To appropriate value, it is important to know how much the customers are willing to pay for the product. This research showed that respondents will consider a subscription if it is between 2,5 – 5 Euros per month. They will not consider subscribing anymore if the price exceeds 10 Euros per month. This leaves a group between 5 – 10 Euros which also thinks that subscription is still cheap, but probably will not subscribe to it. Compared to the tariffs of the printed newspaper, these prices are very low. The online questionnaire also showed the willingness to pay for different kinds of news. Again, regional and local news has the highest willingness to pay compared to personalized news or news on other mobile devices. These percentages are still very low, but not surprising, because people are still used not to pay anything for digital news. At the end of this research, the following recommendations have been made for Wegener: 1. When offering digital news on e-Readers to its customers, Wegener has to have a strong focus on regional and local news 2. News should be offered together with photos and/or videos, so the current e-Readers are not good enough 3. Keeping the price between 2,5 and 5 Euros per month will attract most of the customers 4. Customers prefer (monthly) subscriptions more than small amounts per article 5. Personalized news is an important trend that has to be followed
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
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