Price Coordination in Two-Sided Markets: Competition in the TV Industry
Hans Jarle Kind (),
Tore Nilssen () and
Lars Sørgard ()
No 3004, CESifo Working Paper Series from CESifo Group Munich
The TV industry is a two-sided market where both advertisers and viewers buy access to the programs offered by competing TV channels. Under the current market structure advertising prices are typically set by TV channels while viewer prices are set by distributors (e.g. cable operators). The latter implies that the distributors partly internalize the competition between the TV channels, since they take into account the fact that a lower viewer price at one channel will harm rival channels. We nonetheless find that a shift to a market structure where both advertising prices and viewer prices are set competitively by the TV channels might increase joint industry profits. The reason is that this market structure, in contrast to the one we observe today, directly addresses the two-sidedness of the market. We also show that this is to the benefit for the viewers.
Keywords: price coordination; two-sided markets; media economics (search for similar items in EconPapers)
JEL-codes: D40 D62 L10 L82 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
http://www.cesifo-group.de/portal/page/portal/DocB ... 3/cesifo1_wp3004.pdf (application/pdf)
Working Paper: Price Coordination in Two-Sided Markets: Competition in the TV Industry (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:ces:ceswps:_3004
Access Statistics for this paper
More papers in CESifo Working Paper Series from CESifo Group Munich Contact information at EDIRC.
Series data maintained by Klaus Wohlrabe ().