Internet adoption and the survival of print newspapers: A country-level examination

- We study how Internet adoption affects newspaper circulation and survival rates.
- The Internet can explain a large decline in newspaper circulation.
- The Internet drives newspapers out of business

In this paper we examine the effect of Internet adoption on daily print newspaper circulation and newspaper survival rates. We use country-level yearly panel data for more than ninety countries from 2000 through 2009. Our data contain information on Internet penetration, daily local and national print newspaper circulation, and the number of local and national print newspaper titles. Our results show that increases in Internet penetration can explain a large fraction of the recent decline in newspaper circulation and the number of newspaper titles. We also find that Internet adoption appears to affect the survival of local newspapers to a greater extent than for national newspapers. We argue that this might be due to local newspapers' greater reliance on classified advertising. Our results further suggest that Internet adoption decreases country-level circulation rates by driving newspapers out of business without significantly affecting the net circulation rates of surviving newspapers. Because newspaper readership has been linked to the health of the democratic system, the importance of examining the decline of the newspaper industry extends beyond the literature on the media industry.