The economics of online television: Industry development, aggregation, and “TV Everywhere”

David Waterman, Ryland Sherman and Sung Wook Ji

Telecommunications Policy, 2013, vol. 37, issue 9, 725-736

Abstract: Although still dominated by standard television, the online TV industry is growing rapidly. Entrants employ a range of business models, and we identify a prevalent tendency for leading providers to aggregate programming from a variety of different content owners. We focus on one form of content aggregation by multi-channel programming distributors (MPVDs) widely known as “TV Everywhere (TVE).” Following a brief taxonomy of TVE systems, we develop an economic model to show how this “free-with-authentication” (of MVPD subscribership) bundling practice can be explained as a price discrimination device intended to slow MVPD disconnections. We show that TVE bundling could also deter entry into the online TV market. We discuss the potential roles of horizontal and vertical integration of MVPDs and ISPs in online TV industry development, again focusing on TVE, and conclude with policy implications.

Keywords: Online television; Bundling; Price discrimination; Internet; TV Everywhere; MVPD (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (5)

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DOI: 10.1016/j.telpol.2013.07.005

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