Why Is Exclusivity in Broadcasting Rights Prevalent and Why Does Simple Regulation Fail?

David Martimort and Jerome Pouyet

No 17446, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Pay-TV firms compete both downstream to attract viewers and upstream to acquire broadcasting rights. Because profits inherited from downstream competition satisfy a convexity property, allocating rights to the dominant firm maximizes the industry profit. Such an exclusive allocation of rights emerges as a robust equilibrium outcome but may fail to be welfare maximizing. We analyze whether a ban on resale and a ban on package bidding may improve welfare. These corrective policies have no impact on the final allocation but lead to profit redistribution along the value chain.

Keywords: Broadcasting rights; Upstream and downstream competition; Exclusivity (search for similar items in EconPapers)
JEL-codes: L13 L42 (search for similar items in EconPapers)
Date: 2022-07
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Working Paper: Why Is Exclusivity in Broadcasting Rights Prevalent and Why Does Simple Regulation Fail? (2024)
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