The Advertising-Financed Business Model in Two-Sided Media Markets

Anderson, Simon P.

doi:10.1016/b978-0-444-62721-6.00002-0

Cited by 46 publications

(34 citation statements)

References 101 publications

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“…For surveys of the literature, see Anderson, Strömberg, and Waldfogel (), in particular chapters by Anderson and Jullien (), Foros, Kind, and Sørgard (), and Peitz and Reisinger ().…”

mentioning

confidence: 99%

The importance of consumer multihoming (joint purchases) for market performance: Mergers and entry in media markets

Anderson

Foros

Kind

2019

Economics Manag Strategy

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Consumer "multihoming" (watching two TV channels, or buying two news magazines) has surprisingly important effects on market equilibrium and performance in (two-sided) media markets. We show this by introducing consumer multihoming and advertising finance into the classic circle model of product differentiation. When consumers multihome (attend more than one platform), media platforms can charge only incremental value prices to advertisers. Entry or merger leaves consumer prices unchanged under consumer multihoming, but leaves advertiser prices unchanged under singlehoming: Multihoming flips the side of the market on which platforms compete.In contrast to standard circle results, equilibrium product variety can be insufficient under multihoming.

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“…For surveys of the literature, see Anderson, Strömberg, and Waldfogel (), in particular chapters by Anderson and Jullien (), Foros, Kind, and Sørgard (), and Peitz and Reisinger ().…”

mentioning

confidence: 99%

The importance of consumer multihoming (joint purchases) for market performance: Mergers and entry in media markets

Anderson

Foros

Kind

2019

Economics Manag Strategy

Self Cite

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“…where F is the subscription fee, and Φ > 0 denotes a user's average disutility (e.g., inconvenience) of watching one ad. We assume that the total disutility of watching ads linearly increases with the number of watched ads [20], [32]. In Sections III-A and IV-A, we will analyze the users' optimal decisions r * (θ, ω) and x * (θ, ω).…”

Section: B Usersmentioning

confidence: 99%

Monetizing Mobile Data via Data Rewards

Wei

Berry

2020

IEEE J. Select. Areas Commun.

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Most mobile network operators generate revenues by directly charging users for data plan subscriptions. Some operators now also offer users data rewards to incentivize them to watch mobile ads, which enables the operators to collect payments from advertisers and create new revenue streams.In this work, we analyze and compare two data rewarding schemes: a Subscription-Aware Rewarding (SAR) scheme and a Subscription-Unaware Rewarding (SUR) scheme. Under the SAR scheme, only the subscribers of the operators' data plans are eligible for the rewards; under the SUR scheme, all users are eligible for the rewards (e.g., the users who do not subscribe to the data plans can still get SIM cards and receive data rewards by watching ads). We model the interactions among an operator, users, and advertisers by a two-stage Stackelberg game, and characterize their equilibrium strategies under both the SAR and SUR schemes. We show that the SAR scheme can lead to more subscriptions and a higher operator revenue from the data market, while the SUR scheme can lead to better ad viewership and a higher operator revenue from the ad market. We further show that the operator's optimal choice between the two schemes is sensitive to the users' data consumption utility function and the operator's network capacity. We provide some counter-intuitive insights. For example, when each user has a logarithmic utility function, the operator should apply the SUR scheme (i.e., reward both subscribers and non-subscribers) if and only if it has a small network capacity.

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“…In this study, the profit from selling online content was compared with the profit from renting for a few periods. One study that focused on the impact of the promotional value of a free service was also conducted [19]. Another study revealed that a free music streaming service stimulated overall consumption, thereby increasing profits from advertisements [20].…”

Section: Related Literaturementioning

confidence: 99%

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

Kim

2018

Sustainability

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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.

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The Advertising-Financed Business Model in Two-Sided Media Markets

Cited by 46 publications

References 101 publications

The importance of consumer multihoming (joint purchases) for market performance: Mergers and entry in media markets

The importance of consumer multihoming (joint purchases) for market performance: Mergers and entry in media markets

Monetizing Mobile Data via Data Rewards

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

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