We compare the advertising intensity and content of programming in a market with competing media platforms. With pay-tv, media platforms have two sources of revenues, advertising revenues and revenues from viewers. With free-to-air, media platforms receive all revenues from advertising. We show that if viewers strongly dislike advertising, the advertising intensity is greater under free-to-air television. We also show that free-to-air television tends to provide less differentiated content whereas pay-tv stations always maximally differentiate their content. In addition, we compare the welfare properties of the two different schemes
Peitz, M., Valletti, T.m. (2008). Content and advertising in the media: pay-tv versus free-to-air. INTERNATIONAL JOURNAL OF INDUSTRIAL ORGANIZATION, 26(4), 949-965 [10.1016/j.ijindorg.2007.08.003].
Content and advertising in the media: pay-tv versus free-to-air
VALLETTI, TOMMASO MARIA
2008-01-01
Abstract
We compare the advertising intensity and content of programming in a market with competing media platforms. With pay-tv, media platforms have two sources of revenues, advertising revenues and revenues from viewers. With free-to-air, media platforms receive all revenues from advertising. We show that if viewers strongly dislike advertising, the advertising intensity is greater under free-to-air television. We also show that free-to-air television tends to provide less differentiated content whereas pay-tv stations always maximally differentiate their content. In addition, we compare the welfare properties of the two different schemesI documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.