Pricing of Digital Video Supply Chain: Free versus Paid Service on the Direct Distribution Channel

Abstract

Media publishers that have commonly relied on profits from advertisements and content sales to fund their operations are not only content providers (manufacturers) to media aggregator platforms (retailers) but are also competing service providers (rival retailers) in the digital video supply chain. Different from a traditional media supply chain, they can easily operate their own direct distribution channels in the Internet era. In the digital video supply chain, it is not clear whether commercialization of the direct distribution channel would be beneficial for the media publisher because it would decrease profits from advertisements. The choice about commercialization should be investigated thoroughly because it is closely related to the media publishers’ sustainability as a public medium in a digital environment. In this study, we analyze the impacts of commercializing the direct distribution channel based on a game-theoretic approach. Specifically, we compare the profits of a media publisher with and without the commercialization of the channel from analyses of sequentially defined games. Our results show that media publishers prefer to use a free service on their direct channel if the content they provide is not highly valued. They can also choose not to provide their content to the media aggregator with a paid service.

The Customer Orientation Service of Spanish Brokers in the Insurance Industry: The Advisory Service of the Insurance Distribution Channel Bancassurance

“…Therefore, large broker firms have more incentives to delay forwarding the payment of the premiums to the insurance company than small broker firms, which could suffer financial distress in the event of an incident. Consistent with this evidence, several authors find that brokers' advisory services are influenced to some degree by firm size and quality service [21,26,27].…”

“…Thus, advisory services are influenced to some degree by the firm's size and the employment structure of insurance brokers, as well as by the degree of specialization on private clients [19,20]. They can reach economies of scale and perform fixed cost investments in human capital and technology to easily gather information about product prices, performance and terms [21,22].…”

“…Size works as an indicator of their degree of specialization on private clients and depth of the quality of the services provided. As a result, large companies broker the most complex and highest risks, while small companies deal with lower risks [20,21,25]. Service quality has been recognized as an important factor that leads to the differentiation of services and products and the achievement of competitive advantages; in particular, it is closely related to firm profitability and performance in the service sector [11,46,47].…”

The Pricing Strategy of Digital Content Resources Based on a Stackelberg Game

“…First, producers determine the viewing effect of the content resources to be produced based on existing experience and ability. Then, they use a certain amount of human, material, and financial resources to achieve the expected effect [27,28]. Kim et al [29] studied the influence mechanism of the characteristics of digital content resources on their value, traffic, and usage intensity and found that the viewing experience greatly increases the usage intensity.…”

Video Platforms’ Value-Added Service Investments and Pricing Strategies for Advertisers

“…There is a mass 1 of viewers. Following the Hotelling specification [13,29], we assume that viewers are uniformly distributed along a unit interval of [0, 1], with two platforms located at the two endpoints. Platform 1 is located at point 0 and platform 2 is located at point 1, i.e., x 1 = 0 and x 2 = 1.…”