The Impact of Broadband Internet on Public Media: Evidence from China

Abstract

This paper investigates the impact of broadband Internet on the provision of public media in a large developing country. We use new panel data on public broadcasting at the province level from 2005 to 2017 and a control function approach exploiting variation in China's centralized roll-out of digital infrastructure. We find that rising broadband penetration has substantial negative impacts on the quantity of public media provision—including news, public-service programs, and entertainment—in China's local radio and television. Except for news, these effects are driven by changes in both the extensive margin (i.e., fewer channels) and the intensive margin (i.e., less broadcasting per channel). While industry ad revenues decrease significantly, ad intensity and volume per channel increase with higher broadband penetration rates. Lastly, we find that broadband Internet attracts young, educated, and urban viewers away from television but has no effect on the elderly, the less educated, and those with low-paying jobs.

Keywords: broadband Internet, public broadcasting, media content, advertising