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JOU0010.1177/1464884921992998JournalismPark et al.

Article

Journalism

Regional news audiences’

1­–19
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value perception of local news sagepub.com/journals-permissions
DOI: 10.1177/1464884921992998
https://doi.org/10.1177/1464884921992998
journals.sagepub.com/home/jou

Sora Park , Caroline Fisher

and Jee Young Lee
University of Canberra, Australia

Abstract
Local news outlets are under threat in the digital era, and many are closing or merging
with other news media due to the loss in advertising and audiences. A sustainable business
model to replace traditional dependence on advertising has not yet been established. This
paper examines one aspect of the business – audience payment – to explore the viability
of online news subscription models in the context of local news. An online survey of
2038 news consumers in regional Australia was conducted in 2019 to examine regional
news audiences’ perception of the value of news as a social good and their willingness
to pay for it. The results show that interest in supporting a new online local news outlet
was largely determined by community-oriented values such as a sense of belonging,
the ability to share the news with others, and the loss of a local news service, rather
than the actual content. However, the quality of the journalism content was positively
related to the audiences’ willingness to pay. Trust in local news and existing local news
consumption were important factors in determining both the interest in supporting local
news and their willingness to pay for it. These findings highlight the tension between the
social and financial value of regional news and the obstacles facing entrepreneurs hoping
to address the growing news gaps in regional communities.

Keywords
Audience/engagement, digital news, local journalism, media financing, survey

Introduction
Local news is a critical source of information, a venue for public discussion and debate,
and a mechanism for cohesion in communities (Hess and Waller, 2017). Local media
provides citizens with the opportunity to be a part of the community by creating a personal
connection to the topics that are reported and facilitating their informed participation in

Corresponding author:
Sora Park, News & Media Research Centre, University of Canberra, 11 Kirinari Street, Bruce, Canberra,
ACT 2617, Australia.
Email: sora.park@canberra.edu.au
2 Journalism 00(0)

local public discourse. However, globally, the news media landscape is facing significant
challenges as news publishers compete with digital platforms for both advertising and
readership. Local news in the region is particularly vulnerable to these changes and has
experienced waves of consolidation and closure resulting in fewer jobs and increased
workloads for those who remain. Small regional communities are often left with no or
very little local reporting. Research shows how harmful news deserts can be to the health
and wellbeing of communities (Bucay et al., 2017). The decline in news provision can
weaken the democratic system with reduced accountability and local communities devoid
of critical information (Ferrier, 2017).
In Australia, there has been a sharp decline in the level of available local news (Simons
and Dickson, 2019). According to the Australian Communications and Media Authority’s
(ACMA, 2017a) report, there was a 13% decline in the number of regional Australians
who report having access to all the local content they want, between 2013 and 2016. The
Australian Competition and Consumer Commission’s (ACCC) Digital Platforms Inquiry
(2019) revealed that from 2008 to 2018, 106 newspapers closed in Australia, which is a
15% decrease in the number of local and regional newspapers. During COVID-19 hun-
dreds of local newspapers were suspended or closed (Public Interest Journalism Initiative
[PIJI], 2020). These industry trends are affecting regional news audiences more than
those in the cities, with news gaps emerging in regional areas.
While news organisations continue to experiment with various pay models, most news
outlets are not able to recoup the losses in advertising revenue with audience payment
(Pickard and Williams, 2014). Much of the focus in academia has been on national and
international media companies. Only recently, scholars have started to recognise new
experiments in the local news sector including subscription and membership models,
native advertising, in-house marketing, e-commerce, and events (Jenkins and Nielsen,
2018). Until recently in Australia, the majority of online paid news brands were aimed at
a national audience. In the past 2 years, many local and regional news offerings have
either closed or gone behind paywalls. However, there has been no study into audience
perceptions of the value of entrepreneurial local news. This study aims to fill this gap by
presenting a hypothetical situation to regional news audiences and examining their atti-
tude and perspectives about supporting their own online local news media outlet.
Paying for news is only one indicator of the perceived value of news to audiences
because much available news is free. In this study, we examine both the broader percep-
tion of the social value of news among regional audiences and a narrower perception of
monetary value that is directly linked to news payment. We conducted a survey of local
news consumers in regional Australia to examine audiences’ interest in, and willingness
to support, local news. We focus on the unique characteristics of local news and how
these are considered by local news audiences when deciding to pay for local news.

Literature review
The uniqueness of local news
Community news has two aspects that make it unique and differentiated from national
news; it reveals the social structure to the members, and it cultivates a collective sense of
Park et al. 3

belonging (Janowitz, 1967). Applying this logic to local news, we can identify two dis-
tinct roles. The first role is to facilitate local public interest journalism, where govern-
ment and authorities are held to account. This watchdog function is crucial to local
media. The Public Interest Journalism Initiative, supported by the Australian Local
Government Association, conducted a survey of media managers employed by local
governments in an attempt to better understand the state of local journalism across
Australia, and how declines in news media are impacting on the important function of
reporting on local government (Simons and Dickson, 2019). They found a reduction in
the number of journalists fulfilling the local watchdog function, with about a third of
local government meetings held with no journalist present. This results in many of the
council activities going unreported. ACCC (2019) also found a declining number of arti-
cles in major newspaper publications focusing on stories of public interest such as the
local government, local courts, health, and education. Economists have shown that the
cost of municipal borrowing increases significantly when a local newspaper shuts down
(Gao et al., 2020). While the internet and alternative media sources are widely available,
they have not replaced the local newspaper’s watchdog role.
The second role of local news is building community identity and cohesion by keep-
ing citizens informed about local matters, covering community events, and advocating
for the community. Local newspapers tend to be less sensational compared to national
news and contains positive stories about the people living in the community. Local media
serve communities, provide the opportunity for citizens to discuss and solve local prob-
lems and connect citizens in doing so (Hess and Waller, 2017). Furthermore, news in the
region can be differentiated from suburban local news. Regional newspapers are a cen-
tral part of the news and information network in towns and regions. They are often the
only source of local information and tend to have a closer relationship with their audi-
ence compared to metropolitan media (Park et al., 2020; Bowd, 2003).
Despite the important roles performed by local news, it is still one of the least
researched fields of journalism studies (Hanusch, 2015). Local news has many meanings
but for the purposes of this study, we use it as a narrower term to capture news that is
provided in relatively small communities, especially in non-urban, rural and regional
settings. Örnebring et al. (2020) suggest using the term ‘small-town’ journalism instead
of ‘local news’ because the term ‘local’ implies less important news compared to
‘national’ news. While we chose to use the term ‘local news’, this concept is very similar
to ‘small-town’ journalism.
When examining local news, not only a newspaper’s geographic connection but the
social spaces in which news operates needs to be taken into consideration. Hess (2013)
uses the concept of geo-social news to describe small town publications. Tying newspa-
pers to geographic boundaries is problematic because individuals may engage in similar
communication channels or reside in a similar geographic area but that does not make
them part of the same community. Embedded in ‘sense of place’, this geo-social concept
links audiences to people and places without assuming shared values or common interest
between them or even that they reside in the same area. Instead, it acknowledges that
one’s connection or identification with the geographical area that a newspaper serves is
individual and unique. Drawing on this, the present study defines local news as geo-
social news outlets with a geographic connection to a town or small city.
4 Journalism 00(0)

Studies indicate that audiences place special importance on local news. According to
a study conducted by ACMA (2017b), 86% of regional Australians considered local
news important. They also found that local news was regarded as the most important
genre of news content in allowing people to participate and engage in Australian society.
As such, a recent study on local news consumers revealed that people who live in areas
where the local newspaper or TV news service has closed say the loss of local informa-
tion has had a negative impact on the town and reduced their sense of belonging to their
community (Park et al., 2020).

Paying for news

The digital environment is forcing news outlets to devise alternative business models to
recoup the loss of advertising dollars. The main strategy is to maintain a paid subscriber
base. However, the global average of paid online news customers is still very low at only
about 14% and most of the population may never pay for online news. Even though peo-
ple generally consume a lot of news, their willingness to financially pay for news is low
(Newman et al., 2020). While there are clear societal and normative values of local jour-
nalism, it is often the case that they are not translated into financial viability. The rela-
tionship between the perceived value of the content and a consumer’s willingness to pay
is not straightforward.
According to Picard (2010) news organisations create significant value for society.
However, this societal value does not equate to its exchange value in the market. The
reason news companies are struggling in the digital age is that they have not improved
their value with five key stakeholders: investors, journalists, advertisers, consumers, and
society. The social value of news is not merely financial and must be understood within
its broader social contributions such as accountability, community engagement, and
informing citizens (McQuail and Deuze, 2020).
From the consumers’ perspective, a value proposition of a product or service is based
on dimensions such as economic, functional, emotional, and symbolic values. These
motivate consumers to buy and use a product (Rintamäki et al., 2007). For general
goods and services, consumers’ perceived value is the ‘net valuation of the perceived
benefits accrued from an offering that is based on the costs they are willing to give up
for the needs they are seeking to satisfy’ (Kumar and Reinartz, 2016: 37). However, in
the case of news, if there are many free alternatives, there needs to be additional value
propositions to make people want to pay (Aranyi and van Schaik, 2016; Calder and
Malthouse, 2004).
Multiple factors, including the availably of free alternatives, constitute the value per-
ception of audiences. Therefore, the way news consumers respond to the value proposi-
tions of news may slightly differ from general products or services. The decision to
purchase is not a simple matter of paying. Audiences are used to consuming news – and
giving their attention – but not paying for it. Therefore, it is not surprising that the per-
ceived journalistic and societal values of journalism do not directly lead people to pay for
news (Chen and Thorson, 2019).
According to Goyanes (2015) news consumers’ willingness to pay for news is an
indicator of their perception of its value. For customers to perceive a news offering to be
Park et al. 5

of positive value, benefits must outweigh undesired consequences including both mon-
etary and non-monetary costs (Graybeal and Hayes, 2011; Kumar and Reinartz, 2016).
Heinonen and Hurmeranta (2019) suggest that there are three essential components that
must be fulfilled to make audiences pay for online news: (1) unique content (2) content
that is relevant to the reader; and, (3) paying for the content is smooth. They also note
that behavioural change toward online payment is slow. For instance, their interviews
with the Ekpress Group and Winnipeg Free Press reveal that micropayments, or one-off
payments for news, do not necessarily cannibalise subscription but can be a driver for
subscription, reinforcing the idea that paying for online news requires a change in habit
from individual to ongoing payment. An important factor influencing a person’s prepar-
edness to pay for news is their previous experience with online-purchase or e-commerce.
Dou (2004) found a significant positive impact of online credit card experience on the
payment intent for digital content in general. Others found a link between digital sub-
scription and the willingness to pay for news (Fisher et al., 2019; Fletcher and Nielsen,
2017; Goyanes, 2014).
Some of the non-monetary costs that influence the willingness to pay include encoun-
tering unwanted paywalls (Fisher et al., 2019) and wanting to avoid advertising by using
ad-blocking software (Park et al., 2018). This means that there are factors not related to
the news content per se that influence perceptions of the overall value of news and the
willingness to pay for it.
Certain kinds of content are also known to increase the willingness to pay. Myllylahti
(2017) found publishers of business news tend to consider opinion and hard news as the
most valuable news commodity to place behind a paywall. Sjøvaag’s (2016) study of
Norwegian online publications found that expensive in-depth reporting was quarantined
for paying consumers. Studies found that among those who are willing to pay, the deci-
sion is largely made based on the editorial content. People are more willing to pay for
unique, non-substitutable, high-value content (Goyanes, 2015; Kvalheim, 2014).
O’Brien et al. (2020) conducted a systematic literature review of factors that influence
news payment. They found that most studies included three types of factors. The first are
consumer-based factors such as age, gender, education, and media use. Some studies
included personal attributes such as news interest, experience (internet use/online-pur-
chase) and perception of brand image, which have yielded inconsistent results. The sec-
ond group of factors is related to the product characteristics such as ease of use, exclusive
content, and perceived quality have positive relationships on the willingness to pay. The
third category of factors is related to economic reasoning: paywalls, income, and price.
These factors are the most influential in determining the willingness to pay. They con-
clude that consumer-based and economic factors are clearer factors, while the content
factor is ambiguous. They also found that gender (being male), education, media use,
news interest, format/medium (print or bundle), customisation, quality, specialisation/
niche (e.g. local), and income have a positive impact on pay. In contrast, age, price and
free mentality have a negative effect. In terms of brand image, ease of use and exclusive-
ness, their results were inconclusive.
Many studies have found demographic factors to be important in determining the will-
ingness to pay for news. However, the findings are mixed. Goyanes (2014) found that
younger people, higher-income earners, and those who paid for other digital products are
6 Journalism 00(0)

more likely to pay for online news. On the other hand, Chyi’s (2005) study reported that
income was not related to audiences’ willingness to pay for online news. Some studies
show young people are more willing to pay for online news (Chyi, 2012; Goyanes, 2014).
Chiou and Tucker (2013) found that when paywalls were introduced, visits to those web-
sites declined to a much greater extent among younger audiences. However, Olsen and
Solvoll (2018) found that younger people were more likely to experience superior finan-
cial value from paywalled content than were older people. Nonetheless, younger people
were less willing to pay for it. Another study on US news audiences also found that the
intent to pay for online local news increased with age (Goyanes, 2015). Kammer et al.
(2015) found that young people’s willingness to pay increases if they can curate and com-
bine content from different sources and individualise their news products.
When encountering paywalls, news consumers often adjust their user habits and
become less attached to their local newspaper’s online news content (Chiou and Tucker,
2013). Those who use the internet frequently are slightly less likely to pay for news (Park
et al., 2020). This suggests that news consumers who are online frequently are familiar
with a range of information sources and therefore might be more reluctant to pay for
online news because they are able to find it for free more easily. This may, in part, be
explained by the culture of free news and information that is pervasive on the internet
(Goyanes, 2014). This partly explains the behaviour of younger audiences.
In the case of local news, audiences may consider content and non-content related,
and monetary and non-monetary factors in assessing the value of news. Local news is
characterised by a close connection to the community. Due to this uniqueness, people
may be more willing to support local news in their community than national news. In
fact, a study has shown that people are more likely to pay for specialised local con-
tent, rather than general national and international news (Goyanes, 2015). A qualita-
tive study conducted in a small town in Norway found those who were willing to pay
for local news regarded it as important because it made them feel updated about what
was going on in town and enabled them to participate in local civic life. Those who
were not willing to pay had a sense of detachment from small-town news. These news
consumers tended to have a stronger personal interest in topics beyond the scope of
the town newspaper, such as national and international issues (Olsen, 2020). The
study also found a gap between the perceived societal worthwhileness of local news
and individuals’ willingness to pay for it. While they do not pay for it, many consum-
ers still want local news around and expect it to fulfil democratic functions in their
community.
Especially in case of local news, the psychology of paying behaviour is crucial in
understanding the decision to pay. Goyanes (2020) explains that the financial state of
local news outlets may help persuade people to pay. Both empathy and efficacy come
into play, because local audiences perceive the value of local news to be crucial to serv-
ing their community function.
Ali (2016) proposes that local journalism is a merit good and because it will inevita-
bly be underinvested and under-produced, there needs to be an intervention to provide it
to consumers even if they choose not to pay or not to consume. This implies a strong
social need for local news to be provided, regardless of its market function.
Park et al. 7

Research questions
In sum, the value of local news to audiences is different from that of national news.
However, we also know the perceived social value of local news does not necessarily
equate to monetary value and a willingness to pay for it. We investigate both the social
value people place on local news and the willingness to pay for it. In times when regional
news media are declining and in search of new business models, this paper focuses on the
value perception of a hypothetical fresh news offering among regional news consumers.
The following research questions were asked:

RQ1. What factors are related to the interest in supporting a local news start-up among
regional news audiences?
RQ2. What factors are related to the willingness to pay for a local news start-up
among regional news audiences?

Methodology
An online survey of N = 2038 regional audiences was conducted by a research company
McNair yellowSquares from 25 November to 20 December 2019, following a pretest.
We mainly targeted Local Government Areas (LGAs) with a population between 25,000
and 100,000 for recruitment. In addition, the Queensland small regional city of
Toowoomba (135 k) and New South Wales rural town of Griffith (20 k) were included in
the sample. All metropolitan LGAs were excluded from the sample.
We used a quota for gender, age and education, reflecting the Australian Bureau of
Statistic’s Census 2016. This resulted in a sample with 50% male and 50% female; 12%
aged 18–24, 24% aged 25–34, 17% aged 35–44, 12% aged 45–54, 16% aged 55–64 and
19% aged 65+; and, 19% low education, 37% medium education and 44% high educa-
tion. Almost half of the respondents (43%) were medium income earners (AUD $40,000–
99,999), 26% earned under AUD $39,999 and 23% earned AUD $100,000 and over. We
categorised Local Government Area (LGA)s into ‘small (below 30 k)’, ‘medium (30–
70 k)’, ‘large (70–120 k)’ and ‘very large (above 120 k)’ based on ABS’s distribution of
LGA population. Among 544 LGAs as of 2018, there were 125 in metro areas and 419 in
regional areas. Of the regional LGAs, 58% were classified as ‘very small’, 24% ‘small’,
45% ‘medium’, 13% ‘large’ and 17% ‘very large’. In the sample, respondents’ distribution
is mainly medium to large LGAs (79%), 7% ‘very small/small’, and 15% ‘very large’.
Table 1 summarises the respondents.

Variables
Dependent variables
Interest in financially supporting local news: We gave respondents a scenario where a
new online local news outlet with a local reporter would interest them. We asked if they
were interested in financially supporting an online grassroots local news organisation.
This was measured on a five-point Likert type scale ranging from ‘not at all interested’
8 Journalism 00(0)

Table 1.  Summary of respondents.

Variables N %
Gender Male 1016 50
Female 1022 50
Age 18–24 243 12
25–34 484 24
35–44 345 17
45–54 254 12
55–64 316 16
65+ 396 19
Education Low 387 19
Medium 747 37
High 904 44
Income Low (under AUD $39,999) 528 26
Medium (AUD $40,000–99,999) 877 43
High (AUD $100,000 and over) 478 23
Don’t know/Prefer not to answer 155 8
LGA size U30 k (small) 138 7
30–70 k (medium) 714 35
70–120 k (large) 893 44
120 k+ (very large) 277 14

(1) to ‘extremely interested’ (5). We used this as a continuous variable. This variable
indicates audiences’ perception of the broader social value of local news, as we asked in
terms of how interested they were rather than asking how much they will pay.
‘Willingness to pay’ dummy variable: Then we asked if they were willing to pay for
the new offering and how much. We gave five different types of payment options: Paying
for each story that I read online individually; Paying a monthly subscription fee to get
access to the online grassroots local news provider; Paying a monthly subscription fee to
get access to more than 10 online news brands including the online grassroots local news
provider; Making an annual donation to support the online grassroots local news pro-
vider; Making a one-time donation to support the online grassroots local news provider.
With these options, we gave them the range of payment and asked how much they would
be willing to pay. In this analysis, we did not differentiate those who are willing to pay
more or less. Instead we used the measurement as binary by recoding the variable to
reflect those who are willing to pay and those who are not. Those who chose any of the
given types of payment were recoded as 1, and those who did not choose any in all types
were recoded as 0. This variable measured a somewhat narrower value perception, spe-
cifically, the willingness to pay for local news.

Independent variables
The independent variables used in this study were categorised into individual variables
and news environment variables. For individual variables, demographic variables (age,
Park et al. 9

gender, income, education), local news consumption, trust in news, sense of belonging
and the value perception of news were measured.

Gender: Men were coded as one and women were coded as 0.

Age: A numerical age was used as the variable ranging from 18 to 90.
Education: The level of education was recoded into three groups – Low (up to
year 10), Medium (Year 12 to vocational/non-tertiary degrees), High
(Bachelor’s degree or above).
Income:  Income was also recoded into three groups – low (under AUD
$39,999); medium (AUD $40,000–99,999); high (AUD $100,000 and
above).

Local news consumption: We gave respondents a list of local news offerings (commer-
cial TV, print newspaper, commercial radio, community radio, ABC radio, ABC website,
newspaper website, commercial TV station website, radio website, newsletters, council
newsletter or website, social media sites and other websites with local content) and asked
them to select the ones they accessed regularly. A dummy variable was created where
people who did not access any of these was coded as 0 and those who accessed at least
one of these local media regularly as 1.
Trust in local news: It was measured on a five-point Likert type scale ranging from
strongly disagree to strongly agree to the statement: ‘I think I can trust news from local
media most of the time’.
Sense of belonging: It was measured on a five-point Likert type scale ranging from
strongly disagree to strongly agree with the following five statements: ‘I feel I belong to
my local area’, ‘I can get what I need in my local area’, ‘If there is a problem in the local
area, residents can get it solved’, ‘I feel hopeful about the future of this community’ and
‘I feel connected to others in my local area’. The Cronbach’s Alpha was .80.
Value perception of news: We asked respondents how important 17 factors would be
in considering whether to pay for an online grassroots local news provider on a five-point
Likert type scale ranging from not important to very important. In order to assess the
underlying structure of the 17 items of value of news, factor analysis was performed.
Three variables that reflect the value perception were created. The mean score of items
for each factor was used as a variable that reflected different dimensions of the value
perception of local news; content-related, interactive functionality, and non-content
related convenience dimensions. The first dimension relates to the quality and unique-
ness of content. The second dimension is concerned with the technological functions that
enhance audience engagement with content. This includes the functionality to connect
with other people and the ability to share the news. The third dimension relates to the
factors that are not directly related to the content but improves the news consumption
experience by providing convenience. This includes ad- free news, and easy cancellation
and subscription, for example (see Table 2 for details).
News environment variables were also included in the analysis. These include LGA
size, availability of local news media and the closure of local news outlets.
LGA size: We categorised LGAs into ‘small (below 30 k)’, ‘medium (30–70 k)’, ‘large
(70–120 k)’ and ‘very large (above 120 k)’ and a dummy for each group was entered in
the regression models.
10 Journalism 00(0)

Table 2.  Factor analysis of paid news value measurements.

Factor Item Correlation

Content-related Quality and credibility of the journalism 0.805
(Cronbach’s alpha = 0.89) In-depth coverage 0.748
Having a positive impact on my community 0.729
Supporting an organisation that is working for the 0.715
good of my community
Supporting local news brands, rather than the big 0.638
platforms such as Google and Facebook
Quality of photographs, video and audio production 0.626
Exclusive local news that I can’t get anywhere else 0.530
A mix of international, national and local news 0.373
Interactive functionality Being able to connect with other supporters 0.807
(Cronbach’s alpha = 0.783) Ability to engage with the reporter and contribute 0.749
story ideas
Being heard 0.588
Ability to share stories with non 0.505
Non-content related Ad-free news 0.738
convenience (Cronbach’s Ability to pay only for news stories I want to 0.622
alpha = 0.692) support
Easy cancellation of subscription 0.585
Ability to share the subscription with family/friends 0.465

Criteria: factor (3) iterate (25) rotation (varimax) method (correlation).

Table 3.  Types of payment and the amount willing to pay.

Type Not willing Up to $20 a year More than $20

One-off donation 48% 32% 19%
Annual donation 52% 28% 19%
  Not willing Up to $5 per month More than $5
Monthly subscription (bundle) 52% 26% 21%
Monthly subscription (single) 54% 30% 16%

Availability of local media: The availability of local commercial TV, radio, and local
print newspaper was measured by asking if these were available in the respondents’ area.
These were each used as dummy variables.
Closure of local news: This was measured by asking if they were aware of any local
newspapers, radio, or TV outlets that went out of business or merged with other media in
the past 5 years in the area. Those who answered yes were coded as 1, all others (don’t
know and no) were coded as 0.

Data analysis
Data analysis was performed using SPSS 24. Ordinary Least Squares regression was
conducted to estimate being interested in financially supporting local news, and Logistic
Park et al. 11

regression was conducted to predict the probability of the willingness to pay for local
news by entering the independent variables described above.

Results
Descriptive analysis
In this study, we differentiated the social value perception of news – indicated by a gen-
eral interest in financially supporting a new local grassroots online news service, from
the monetary value – indicated by the willingness to pay for the service. As summarised
in the above section, value perception consists of multiple factors and monetary value is
only one of them. Interest in supporting a local news service includes a range of factors
that influence the perception of social value, while the willingness to pay singles out the
monetary value that consumers place on the news.
Twenty-nine percent of respondents were extremely or very interested in financially
supporting a new online local news service, 59% were somewhat interested, not very
interested, or not at all interested. Twelve percent were undecided. We then gave differ-
ent choices of pay per story, monthly subscription, monthly subscription bundled with
other news, one-off donation, and annual donation. About one-third (36%) were not will-
ing to pay at all. For a monthly, single brand subscription, 46% said they would be will-
ing to pay up to AUD $5 per month. If bundled with ten other news brands, 48% were
willing to pay up to AUD $5 per month. Annual or one-off donations were the most
preferred payment options, with almost half (48%) saying they were willing to pay AUD
$20 per year, and 52% were willing to pay AUD $20 as a one-off donation. Those who
said they were not very interested in supporting a new local news service were also still
willing to commit a small amount of money.
We examined whether those who live in areas that had news closures would be more
willing to pay for a new local news offering. Respondents were asked if any local news-
papers, radio, or TV outlets in their area had gone out of business or merged with other
news media organisations in the past 5 years. Almost one in five (19%) said they had
experienced a local news outlet close or merge, 19% had not, and the majority (62%)
were not sure. Those who had experienced a closure or merger were more likely to be
interested in financially supporting a grassroots online news service in their area (38%),
compared to those who hadn’t (34%) or did not know (25%) (see Table 3).

Interest in supporting local news

We conducted an Ordinary Least Squares (OLS) regression analysis using interest in
supporting local news as the dependent variable as an indication of how much value is
placed on local news, and what factors influenced the valuation. The model was statisti-
cally significant (F = 22.700, p < 0.001) (Table 4).
Age (β = −0.157) and gender dummy (male = 1; β = 0.101) were significant factors in
predicting the interest in supporting local news, showing that younger people and men are
more likely to be interested. Other demographic variables, including income and educa-
tion, were not significant. The size of the LGA was related to respondents’ interest in
12 Journalism 00(0)

Table 4.  OLS regression results: Dependent variable is ‘interest in financially supporting a new
local news service’.

B ß t
Age −0.009 −0.157 −5.843***
Gender dummy (ref. male) 0.202 0.101 3.916***
Education 0.026 0.019 0.828
Income −0.047 −0.034 −1.454
LGA size dummy ref. U30 k 0.016 0.004 0.177
ref. 30–70 k 0.117 0.056 2.289*
ref. 120 k+ −0.031 −0.011 −0.455
Value perception of news Content/community 0.094 0.076 2.065*
Interactive function 0.255 0.246 7.533***
Convenience −0.106 −0.095 −3.015**
Sense of belonging 0.196 0.146 5.612***
Trust in local news 0.087 0.085 3.398**
Experienced local news closure 0.179 0.07 3.124**
Local news consumption 0.214 0.094 4.065***
Availability of local news media Commercial TV −0.149 −0.064 −2.61**
Print newspaper −0.076 −0.033 −1.242
Commercial radio −0.086 −0.04 −1.518
Adjusted R2 0.182
F 22.700
VIF 1.031~2.715

LGA size 70–120 k (large) dummy was excluded from the final model due to high multicollinearity.
*p < 0.05. **p < 0.01. ***p < 0.001.

supporting local news. Those who live in medium LGAs (30–70 k) (β = 0.056) are more
likely to be interested in supporting local news, compared to those who live in other regions,
but there was no significant difference between small, large, and very large LGAs.
The three values perceptions news consumers place on paid news services emerged as
significant variables; however, the directions were inconsistent. While the interactive
function (β = 0.076) and the ability to connect with other audiences or reporters (β = 0.246)
were positively related to interest in supporting a local news service, the convenience
(β = −0.095) was negatively related. This suggests that those who value the interactive
function and the ability to connect with other audiences or reporters are more likely to be
interested in financially supporting a local news service, but those who value conveni-
ence are less likely to be interested in supporting local news.
A sense of belonging (β = 0.146) and trust in local news (β = 0.085) were positively
related to the interest in supporting a local news service. This suggests that those who
have a stronger sense of belonging to the local community and higher trust in local news
are more likely to be interested in supporting it. Also, those who had experienced the
closure of a local news outlet were more likely to be supportive (β = 0.07).
Local news consumption was also a significant predictor (β = 0.094) in predicting the
interest in supporting a local news service, suggesting that those who already seek local
Park et al. 13

news and information are more likely to be interested. The availability of local TV news
media was negatively related to interest in financially supporting local news, showing those
who live in areas with local TV news options are less likely to want to financially support a
new entrant. This implies that those who already have local news available via TV may be
less likely to want to support a new offering. Availability of other local news media, such as
print and radio, was not related to the interest in financially supporting local news.

Willingness to pay for a new local news service

In the survey respondents were asked about their willingness to pay for a local news
service by giving them a range of options with dollar figures. It should be stressed, their
responses should be interpreted as indicative only, and not an accurate estimate of the
actual willingness to pay. Instead of using the dollar figures, we created a dummy vari-
able to differentiate between those who said they are willing to pay and those who said
they are not. We conducted a logistic regression analysis using the willingness to pay for
local news dummy as the dependent variable. This was to gauge the audiences’ percep-
tion of the monetary value of local news. The model was statistically significant
(χ2 = 323.721, p < 0.001).
Like the first model, age (β = −0.015) is negatively related to the willingness to pay,
showing younger people are more likely to be willing to pay for local news. However, the
gender variable was not significant. Education (β = −0.364) is negatively related to the
willingness to pay. Those with low educational attainment are less likely to be willing to
pay for local news compared to those with medium or high educational attainment.
The size of the LGA was related to participants’ willingness to pay for news. Those
who live in large LGAs (70–120 k) are more willing to pay for local news compared to
those who live in very large LGAs (120 k+) (β = −0.363), but there was no significant
difference between small, medium, and very large LGAs. This indicates that those who
live in areas with a population of 70–120 k (large LGAs) are the most likely to be willing
to pay for a new local news service.
The perception of the value of news content was important when deciding whether to
pay for news. The content-related value perception was the strongest predictor (β = 0.726).
The ability to interact with the online news outlet and its journalists was also an impor-
tant predictor (β = 0.212), but to a lesser degree; and non-content related convenience did
not emerge as a significant predictor in the willingness to pay for local news.
The consumption of local news (β = 0.403) and trust in local news (β = 0.168) were
also positively related to peoples’ willingness to pay for a new local news service. This
suggests that those who have a higher trust in local news and those who already consume
local news are also more likely to pay for a new service. However, other news environ-
ment-related variables, including the availability of local media and experience of a local
news closure, did not influence the willingness to pay for a new service (Table 5).

Discussion and conclusion

Analysis of the data reveals that a regional consumer’s interest in supporting local news,
and their willingness to pay for it, were both influenced by their trust in local news and
14 Journalism 00(0)

Table 5.  Logistic regression results: Dependent variable is ‘willingness to pay for a local news
service’ (Reference group: ‘would not pay for any type of local news’).

B S.E. ß
Age −0.015*** 0.004 0.985
Gender (ref. male) 0.122 0.123 1.13
Education (ref. High) Low −0.364* 0.149 0.695
Medium −0.058 0.122 0.944
Income (ref. High income) Low −0.171 0.154 0.843
Medium −0.045 0.136 0.956
LGA size (ref. 120 k+) U30 k −0.316 0.251 0.729
30–70 k −0.138 0.175 0.871
70–120 k −0.363* 0.169 0.695
Value perception of news Content/community 0.726*** 0.111 2.067
Interactive function 0.212** 0.081 1.236
Convenience −0.045 0.085 0.956
Sense of belonging 0.165 0.085 1.18
Trust in local news 0.168** 0.062 1.183
Experienced local news closure 0.185 0.142 1.203
Local news consumption 0.403** 0.121 1.496
Availability of local news media Commercial TV 0.011 0.135 1.011
Print newspaper 0.269 0.143 1.309
Commercial radio 0.063 0.134 1.066
Nagelkerke 0.219
Cox & Snell 0.159
−2 Log likelihood 2089.996a
No. of observations 1869
Chi-square 323.721

*p < 0.05. **p < 0.01. ***p < 0.001. [The Hosmer–Lemeshow test was used a statistical test for goodness of
fit for logistic regression models (p = 0.056)].

whether they were already a regular local news consumer. In general, the perception of
trust in local news is higher than that of national news. This supports the logic that local
news has both a democratic and community function to audiences (Ali et al., 2020) and
that people are more invested in their local news offerings. The fact that trust was related
to the willingness to pay is different from that of national or general news, where the
relationship between trust and pay is not always clear (Fisher et al., 2019). Trust in news
has been found to be one of many factors influencing the willingness to pay but not nec-
essarily the main factor (Fletcher and Nielsen, 2017). In the local news context, however,
trust emerged as an important variable.
We differentiated the overall value of local news to regional audiences from their
willingness to pay financially for it. Although they are overlapping concepts, the former
reflects a broader value including the recognition of societal benefits of local news. The
latter is more focused on the monetary value and benefits of local news to an individual.
The results yielded interesting differences.
Park et al. 15

While, a news consumer’s interest in supporting local news was largely determined
by community-oriented factors, such as the sense of belonging and the ability to share
the news with others, the actual editorial content was deemed to be less important. When
people think about news as a social good, they are more likely to place importance on the
community function of local news rather than the immediate utility of the news content.
According to Pew Research Centrer’s (2019) survey of local news in the US, community
residents who see their local journalists as being connected to the area, give their local
news media far higher ratings than those who do not. In line with this, our findings con-
firm that local audiences expect a connection with their local news providers.
It is worth noting our finding of the negative relationship between the value of con-
venience and consumers’ interest in supporting local news. This possibly means that
local news consumers who are interested in supporting a grassroots local news service do
not consider the aspect of convenience to be important.
When asked specifically about the monetary value of local news, content emerges as
the most important factor. The emphasis on the quality of content is consistent with pre-
vious studies that indicate that a common strategy to monetise online news is to provide
content that is relevant to the consumers (Myllylahti, 2017; Pickard and Williams, 2014;
Sjøvaag, 2016). The uniqueness of content is found to be important in determining the
willingness to pay for news (Goyanes, 2015; Kvalheim, 2014). Having access to interac-
tive functions was also important in determining the willingness to pay. However, having
a sense of belonging was not a key factor. In other words, the social good aspects of local
news were less important when it comes to paying for the news.
In sum, the factors that influence the overall value perception and the factors that
determine the willingness to pay were not the same. Community and societal values were
deemed more important in the overall valuation, whereas the content and convenience
factors were more important in deciding to pay for news. This means the appeal of the
paywall value proposition is related to the content, rather than other social benefits. This
is an important finding because it might play a crucial role in future revenue strategies
for local news media.
This study found that younger generations are more supportive of local news and are
more willing to pay for it, which is contradictory to Olsen and Solvoll’s (2018) and
Goyanes’ (2015) findings. This may be that younger people do appreciate the value of
local news, but in reality, they do not find local news content to be particularly appealing.
Whereas in our study, we presented respondents with a hypothetical situation where
high-value content would be on offer, and therefore led respondents to express a stronger
willingness to pay for it. This mismatch of willingness to pay and finding relevant con-
tent is an issue that news media is constantly challenged with, especially their value
propositions to younger audiences. In other words, had they been given value content,
they might be more willing to pay.
This study also confirms that while people value local news and are aware of its soci-
etal values, their willingness to pay is still very low. This means that paid subscription is
unlikely to be a sustainable sole revenue stream for local news businesses. However, it
does mean that those who place a high value on news and its social impact will pay atten-
tion to the news as active news consumers. News companies will need to find ways to
capitalise on this demand through multiple revenue streams.
16 Journalism 00(0)

There is a mix of optimism and pessimism regarding the news industry with regards to
local news. There are successful local and community news experiments. But there are
also dire challenges. The crisis in local news is that local areas are experiencing a struc-
tural shift from having had a low choice among local news consumers and high market
power over advertisers among local media, to a world where local news consumers have
a high choice but the local media have weak market power over advertisers (Nielsen,
2019). Building a loyal paid subscriber base may be a crucial element of the future sus-
tainability of local news outlets in the digital age. There is evidence that local newspapers
can provide non-substitutable content that is highly valued by news consumers (Goyanes,
2015; Kvalheim, 2014). Given that audiences respond to content characteristics when
deciding whether to pay, there may be successful strategies for local news outlets.
While this study contributes to our understanding of what motivates consumers to pay
for local news, it has some limitations. Firstly, the survey findings are not based on actual
behaviours, but on participants’ perceptions about a hypothetical situation. From this
study, we know the factors that people regard to be important when they decide to pay
for news. However, in real life, there are many other external factors including individual
and societal circumstances that will influence audience behaviour. Furthermore, the
high-value content they are seeking and willing to pay for may not be on offer. The sec-
ond limitation relates to the representativeness of the sample. We restricted the respond-
ents to those who live in areas with a population under 120,000 in regional Australia.
Therefore, the results cannot be generalised to a wider population or to urban areas.
This study is unique in the sense that there have been very few studies addressing
local news in regional areas and discovered that the willingness to pay for regional news
is different from that of national news. The results are a good starting point of investigat-
ing the differences and commonalities of local news and will shed light on methods to
make regional news a viable business. In doing so, it highlights the tension between
social and monetary value of news and translating perceptions of value of news into
actual payment.

Funding
The authors disclosed receipt of the following financial support for the research, authorship, and/
or publication of this article: The authors received funding from Google News Initiative for this
research.

ORCID iDs
Sora Park https://orcid.org/0000-0003-3082-314X
Caroline Fisher https://orcid.org/0000-0002-7443-3787

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Park et al. 19

Author biographies
Sora Park is the Associate Dean of Research for the Faculty of Arts & Design and Professor of
Communication at the University of Canberra. Her research focuses on digital media users, media
markets and media policy. She is the Leader of the Digital News Report: Australia project.
Caroline Fisher is a Deputy Director of the News and Media Research Centre, Associate Professor
of Communication in the Faculty of Arts & Design, University of Canberra and co-leader of the
Digital News Report: Australia project.
Jee Young Lee is a Lecturer at the Faculty of Arts & Design, University of Canberra. She was the
former Digital News Report Postdoctoral Research Fellow at the News & Media Research Centre.
Her research focuses on digital inclusion practices and policies, particularly for emerging digitally
excluded social groups and the growing digital media consumption in emerging markets.