“Shortage” is such a loaded word to use in all these contexts these days. What they really mean is - paper is expensive and people are reading the news digitally anyways, so it not worth it to them to spend the money.
Well, people still prefer physical newspaper in third world countries. Digital news mostly consists of social media which ain’t a replacement of actual newspaper. So, it is a significant development in that sense. But every crisis brings an opportunity so maybe more people will start reading e-paper.
Paper is expensive because there is a shortage. If there were enough paper to meet all of the previous needs, then the price wouldn’t have increased.