Free Versus For-a-Fee: The Impact of a Paywall on the Pattern and Effectiveness of Word-of-Mouth via Social Media

Alternative Mechanisms Rationale/Arguments/ Assumptions Connected Literature/Theory Resulting (Possible) Effect Support for/Against A1. Based on WTP and Exposure Theory A1a Light user segments (who are likely to have low WTP) are more likely to reduce (or even discontinue in extreme cases) their consumption of NYT content after the paywall implementation. Utility theory — WTP (Danaher 2002) Juxtaposing A1a and A1b leads to long tail effect due to the disproportionate reduction of popular content consumption (as a results of reduction of content consumption by light users). A1a. Supported (see the descriptive statistics in Table 11). A1b. Supported (see results from the postestimation of finite mixture model in Table 9) Since the resulting effects as well as both the assumptions (A1a and A1b) are supported, we suggest that there is support for this mechanism. A1b Light user segments are more likely to consume popular articles whereas the heavy user segment is more likely to consume a mix of niche articles and popular content. Exposure theory (McPhee 1963)