Getting beer during commercials: adverse effects of Ad-Avoidance

Torben Stuehmeier and Tobias Wenzel

No 10/2009, FAU Discussion Papers in Economics from Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics

Abstract: This paper studies the impact of ad-avoidance behavior in media markets. We consider a situation where viewers can avoid advertisement messages. As the media market is a two-sided market, increased ad-avoidance reduces advertisers' value of placing an ad. We contrast two financing regimes, free-to-air and pay-TV. We find that increased avoidance opportunities decrease profits and entry in the free-to-air regime. In contrast, in the pay-TV regime, lower income from advertisements are compensated by higher subscription income leaving profits and the number of channels unaflected. Bypassing advertising messages affects welfare ambiguously.

Keywords: Media Markets; Two-Sided Markets; Ad-avoidance (search for similar items in EconPapers)
JEL-codes: L11 L13 (search for similar items in EconPapers)
Date: 2009
New Economics Papers: this item is included in nep-cul, nep-mkt and nep-net
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https://www.econstor.eu/bitstream/10419/29560/1/612507629.pdf (application/pdf)

Related works:
Journal Article: Getting beer during commercials: Adverse effects of ad-avoidance (2011)
Working Paper: Getting beer during commercials: adverse effects of ad-avoidance (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwqwdp:102009

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