Intermediaries in Two-Sided Markets: An Empirical Analysis of the US Cable Television Industry

Andre Boik

American Economic Journal: Microeconomics, 2016, vol. 8, issue 1, 256-82

Abstract: Local television stations are platforms in a two-sided market connecting advertisers and viewers. This paper explicitly examines the effect that important intermediaries (such as cable, telephone, and satellite distributors) may have on a platform's pricing behavior in a two-sided market. I find that stations raise their fees to cable distributors because stations prefer that viewers access their content through satellite distributors with whom they do not compete in the local advertising market, and that station mergers lower stations' fees to distributors by partially internalizing a pricing externality that results from the mandatory bundling of local content. (JEL C78, D12, G34, L11, L82, M37)

JEL-codes: C78 D12 G34 L11 L82 M37 (search for similar items in EconPapers)
Date: 2016
Note: DOI: 10.1257/mic.20140167
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Citations: View citations in EconPapers (12)

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