Economic Analysis of the Great Success of Free Newspapers

Free content is supplied for example by internet, TV and a
free newspaper. An increasing use of internet is a crucial factor of long term success,
as it implies a higher supply of free media content. This enlarges the demand
for free content, in other words it reduces the willingness to pay for content
like information and entertainment. This is a big chance for publishers of
free newspapers.
The free newspapers mainly appeal to a young target group. Therefore it is very
important for the long term success that the society is not running out of this target
group. Many European countries have the problem of an ageing society. This
is why the publishers have to be aware of the demographic development constantly
and should always try to locate agglomeration areas of their target group.
Agglomeration areas have another crucial impact on the long term success. To be
attractive for the advertisement space demanders (who are the source of revenue
for the free newspaper publisher) it is most important to have a very high circulation
of the newspaper.