Year: 2005
Type: preprint
Abstract: : This paper analyses how competition between media firms influences the way they are financed. In a setting where a monopoly media firm chooses to be completely financed by consumer payments, competition may lead the media firms to be financed by advertising as well. This way, competition endogenously creates a two-sided market, with the media firms as platforms between the audience and the advertisers. The closer substitutes the media firms ’ products are, the less they rely on consumer payment and the more they invest in programming. If their products are sufficiently close substitutes, then they commit to being purely financed by advertising, which leads to a downward shift in programming investments.
Authors: Hans Jarle Kind, Tore Nilssen, Lars Sørgard
Institutions: Norwegian School of Economics, University of Oslo
Language: English
Subfield: Strategy and Management
Domain: Social Sciences
Open Access status: green
Funder: Norges Forskningsråd
OpenAlex ID: W1574969786