  A Bayesian agent experiences gain-loss utility each period over changes in
belief about future consumption ("news utility"), with diminishing sensitivity
over the magnitude of news. Diminishing sensitivity induces a preference over
news skewness: gradual bad news, one-shot good news is worse than one-shot
resolution, which is in turn worse than gradual good news, one-shot bad news.
So, the agent's preference between gradual information and one-shot resolution
can depend on his consumption ranking of different states. In a dynamic
cheap-talk framework where a benevolent sender communicates the state over
multiple periods, the babbling equilibrium is essentially unique without loss
aversion. More loss-averse agents may enjoy higher news utility in equilibrium,
contrary to the commitment case. We characterize the family of gradual good
news equilibria that exist with high enough loss aversion, and find the sender
conveys progressively larger pieces of good news. We discuss applications to
media competition and game shows.
