Multi-homing readers (Continued)
demand with observed ad levels, 71–74
heterogeneous advertisers, 74–76
incremental pricing of ads, 68–71
incremental pricing principle, 67
information congestion, 76–77
newspapers and magazines, 425–426
second impression, 67
take-aways and ways forward, 77–78
Multi-Program Video Distributor (MVPD), 278
Music industry, 384–391
Mutual Broadcasting System, 345–346
N
Nash price setting equilibrium, 112
National Public Radio (NPR), 348–349
Negative preference externality, 16–17
Nelson effect, 172
Net neutrality
Internet, 468–470
online video, 331–332
New media business models, 215–217
News aggregators, 462–466
Newspapers and magazines
advertising, 422–427
antitrust issues, 427–433
cross-externalities, 417–418
data sources, 408–409
economic forces, 398
electoral process, 404–405
high-speed printing technology, 402
Internet, 433–437
joint operating agreements, 398–399
mailing rates, 401
market structure, 409–416
Newspaper Preservation Act of 1970, 398–399
partisanship, 403–404
photocomposition and offset printing, 402 – 403
pricing issues, 421–422
pricing model, 400–401
research, 437–440
stylized facts, 405–408
technological changes, 402
two-sided markets, 400, 418–421
New York Times, 405
Non-commercial vs. commercial broadcasters,
381–384
Nonlinear tariffs and insulated equilibrium, 63–66
O
Observational learning, 491–492
Oligopoly, 295–296
One-sided markets
possible price effect, 251–253
price and quantity effects, mergers, 229–230
Online video distributors (OVDs), 327
Online video markets
net neutrality and foreclosure, 331– 333
online video facts, 329–331
Optimum media diversity, 21–22
OTT Internet television, 329
OTT video services, 211
Over-the-top (OTT) aggregators, 330
Own-group preference externality
market size and consumption, 32
market size and entry, 29
market size and quality, 30–31
market size and variety, 29–30
P
Pairwise monotonicity, 158–159
Pareto-dominated equilibrium, 174
Payola, 387–388
Pay television
distribution, 276–278
program production, 278 –284
PeopleMeters, 209
Per-click price (PCP), 482–483
Performance-based ad pricing, 457, 458f
Persuasive advertising, 190
Pilkington Committee, 304
Portable People Meters (PPMs), 353–354
Positive within-group preference externality, 28
Possible non-price effect, 257–258
Possible price effect
empirical studies, 255–257
one-sided market approach, 251–253
two-sided market approach, 253–255
Preference externalities
advertiser finance, 9–10
change in costs over time, 10
cross-group externalities, 22–23
duopoly, 17–20
efficient entry, 35–36
fixed costs, 6, 36–38
lowest common denominator, 14–16
536
Index
market size and equilibrium media diversity,
20–21
markets with few products, 32–34
markets with many products, 34–35
media markets, 4–5
media products, 5–6
monopoly, 16–17
multiple stations, 25 –28
optimum media diversity, 21–22
own-group, 25–28
preference heterogeneity, 7–8
second-choice products, 9
Steiner and Beebe models, 11–13
technological change, 36 –38
Tyranny of the Yuppies, 13–14
variety, 23–25
Preference heterogeneity, 7–8, 316–321
Premium programming networks, 278–280
Price advertising
price dispersion, 131–134
product differentiation, 137– 142
Price and quantity effects of mergers
one-sided markets, 229–230
semi-collusion effects, 235–236
two-sided markets, 230–235
Price discrimination, 60
Pricing issues, newspapers and magazines, 421–422
Principle of incremental pricing, 69
Print media industry. See Newspapers and magazines
Product advertising
credibility, 165
empirical evidence on advertising content,
144–146
forced disclosure laws, 165
match advertising, 146–154
match information, 165
misleading advertising, 161–164
Nelson’s question, 143–144
product attributes, 154– 161
Product attributes
competition and disclosure, 159–161
disclosure of horizontal match attributes, 156–
159
monopoly model, 154–155
private information, 154
unraveling of quality information, 155–156
Product differentiation, 137–142, 364–369
Program Access rules, 325–326
Program Carriage rules, 325–326
PSBs. See Public Service Broadcasters (PSBs)
1967 Public Broadcasting Act, 348–349, 382
Public Service Broadcasters (PSBs), 269–270
core purposes, 271–273, 274f
effects, 305–306
history, 302–304
locally and nationally produced programming,
274
public funding, 274–275, 275f
response to market failure, 304–305
two-sided TV market, 272f, 274
R
Radio
advertising market, 360–364
advertising revenues, 342
Arbitron, 353
BIA database, 352–353
Biltmore program, 346–347
chain broadcasting, 347
challenges, 342–343
Citadel Broadcasting, 351
commercial religious programming, 348–349
conferences, 345
contemporary music, 386–391
daytime programming, 348
Duncan’s format classification, 354–355
economies of scale and scope, 373–375
electronic Portable People Meters, 353–354
excess entry, 375–376
industry consolidation effects on market
outcomes, 356–359
KDKA, 345
listeners and advertisers, 369–372
local programming, 344
maritime and military purposes, 345
Mediabase, 355–356
network programming, 346
non-broadcast sources, 351–352
non-commercial vs. commercial broadcasters,
381–384
oligopoly structure, 350
payola scandals, 348
politics, 385–386
portability, 343–344
product differentiation and variety, 364–369
product variety and deregulation, 342–343
1927 Radio Act, 343
537
Index
Radio (Continued)
radio transmission, 347–348
Red and Blue networks, 345–346
SQAD, 355
strategies for retaining listeners, 376–381
syndicated programming, 356
1927 Radio Act, 343
Radio Act of 1912, 345
Radio Act of 1927, 345
Radio Corporation of America (RCA), 345
Regional Sports Networks (RSNs), 278–280
Repeat purchase and money burning, 171–173
Representative consumer models, 55–56, 99
Retail (distribution) markets, 313–315
Robot journalism, 437
S
1999 Satellite Home Viewer Improvement Act, 276
Satellite radio, 351–352
Screen proliferation, 212
Search advertising, 456
Search engines
media content, 466–467
search bias, 481– 491
Second-choice products, 9
See-saw effects, 58–59
Semi-collusion effects, 235–236
Set-Top Boxes (STB), 209
Single-homing consumers, 230–231
Single-homing viewers
ad-finance game, 48
ad revenue/subscription revenue balance, 51–55
competitive bottlenecks, 56–57
consumer information, 62–63
free-to-air low-quality media platform, 50
heterogeneous ad-nuisance costs, 60
logit model, 48–49
market failures in advertising finance, 60–61
nonlinear tariffs and insulated equilibrium, 63–66
oligopoly analysis, 49
platform’s profit, 47
price discrimination, 60
price vs. quantity, 61–62
profit function, 49
pure ad finance, 47
representative consumer models, 55–56
see-saw effects, 58–59
standard Lerner/inverse elasticity conditions, 49
standard symmetric oligopoly model, 48–49
TiVo, 60
vertical product differentiation, 50
Single-parameter nested logit, 100–101
Socially-targeted ads, 505
Static quality signaling, 168–170
Steiner and Beebe models, 11–13
Steiner’s duplication principle, 79–80
T
Targeted advertising, 180–182
ambulance-chasing behavior, 504–505
consumer product valuation, 503
consumer segments, 495–496
efficiency effect, 497
geo-targeting, 496
imperfect competition, 495–496
market-clearing condition, 501
online vs. offline media, 502
price discrimination, 498
product differences, 499
profit function, 497, 501
scarcity effect, 497
socially-targeted ads, 505
Technological change, 36–38
1996 Telecommunications Act, 276–277, 349
Television industry
bargaining, 306–308
barriers to entry, 308–316
baseline model, 292–299
broadcast, 270–275
cross-platform television statistics, 285–291
DTT, 284–285
open policy issues, 321–327
pay, 275–284
preference heterogeneity and bundling,
316–321
public service broadcasters, 302–306
simple model evaluation, 299–302
TiVo, 60
Tracking and personalized offers, 512–522
Two-channel monopoly, 232–233
Two-sided markets
multi-homing consumers, 231–235
newspapers and magazines, 416–422
possible price effect, 253–255
single-homing consumers, 230–231
538
Index
U
Upward pricing pressure (UPP), 246
US Newspaper Preservation Act of 1970, 398–399
US pay-television industry, 276
US programming market revenue, 288, 289–290f
V
Vertically differentiated duopoly, 159–160
Vertical merger review, 326–327
Vertical price restrictions, newspapers and
magazines, 432–433
Vickrey–Salop circle model, 45–46
Video-sharing websites, 491
W
Welfare effects of à la Carte, 319–321
Wholesale (programming) markets, 309–313,
322–323
Y
Yellow Page industry, 415
539
Index
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