The costs of free: commoditization, bundling and concentration

Jonathan M. Barnett

Journal of Institutional Economics, 2018, vol. 14, issue 6, 1097-1120

Abstract: Digital markets offer abundant free content but exhibit extreme concentration among content aggregation intermediaries. These characteristics are linked. Weak copyright environments select against stand-alone content-delivery structures and select for bundled aggregation structures in which free content for users promotes positively priced advertising and data-collection services for firms. Dominant intermediaries promote commoditization, and the reallocation of market rents from content producers to content aggregators, through litigation and free content distribution that weaken copyright protections. The potential net welfare effects raise concern. Network effects, compounded by weak inventory constraints, scale economies, and learning effects, promote winner-takes-all outcomes in the intermediary services market while weak copyright may generate output distortions in the content production market.

Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:jinsec:v:14:y:2018:i:06:p:1097-1120_00

Access Statistics for this article

More articles in Journal of Institutional Economics from Cambridge University Press Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK.
Bibliographic data for series maintained by Kirk Stebbing ().