Impact of Moderate and Ruinous Competition on Diversity: The Dutch Television Market

Abstract

This article analyzes how competition in television broadcasting influences diversity of program supply. We argue that competition in oligopolistic broadcasting markets can take different forms, depending on the strategies adopted by broadcasters. We distinguish between moderate and ruinous competition, and discuss under what conditions these types of competition will emerge. We hypothesize that moderate competition improves diversity, whereas ruinous competition produces excessive sameness. We test these hypotheses for the Dutch television market.

Multinational web uses and gratifications: Measuring the social impact of online community participation across national boundaries

“…Local, regional, and international programming is available for Dutch audiences through cable, digital, and print media. The current media marketplace and media consolidation may have unintended consequences for the Dutch television market, where it has been hypothesized that the effect of high levels of competition may result in excessive sameness [76]. Digital and traditional media content preferences may explain the media use and adoption gap.…”

Competition, Concentration and Diversity in European Television Markets

“…Market reflective diversity, on the other hand, assesses whether the market provides different programme types in the same proportion as they are preferred by users; that is, whether supply is similar with respect to the structure of demand (see again Table I). This reflects the economic consideration that supply should match demand (McQuail and Van Cuilenburg, 1983;Van Cuilenburg, 1999; Van der Wurff and Van Cuilenburg, 2001).…”

The Relationship of Competition and Financial Commitment Revisited: A Fuzzy Set Qualitative Comparative Analysis in European Newspaper Markets

“…Cyr et al, 2005). If we take a look at research on the effects of competition beyond the financial commitment approach there is evidence that with the number of competitors increasing in a market and, thus, resources of the competitors becoming limited differentiation strategy and higher investment into content production are increasingly substituted by cost centred strategies (Hollifield, 2006;van der Wurff & van Cuilenburg, 2001). Simple mathematics illustrate that an increase in the numbers of firms in a given market reduces a firm's share of resources -everything else being equal.…”

“…In addition, the basic argument of the financial commitment approach is a common economic notion. Product differentiation and quality improvement are a way for media firms to prevent unbridled competition for customers (Lacy, 1992;Tirole, 1988;van der Wurff & van Cuilenburg, 2001). It is, thus, the question whether the assumption of the first step of financial commitment approach holds true in European newspaper markets that are for the most part oligopolies too and market conditions are similar (Hollifield, 2006, p. 60).…”