Chapter 6: Merger Policy and Regulation in Media Industries
by David Stromberg, Joel Waldfogel, Simon P. Anderson
Handbook of Media Economics, vol 1A
- Front Cover
- Handbook of Media Economics
- Copyright
- Introduction to the Series
- Contents (1/2)
- Contents (2/2)
- Introduction
- Contributors
- Acknowledgment
- Dedication
- Part I: Media Market Structure and Performance
- Chapter 1: Preference Externalities in Media Markets
- 1.1. Introduction
- 1.2. Fixed Costs and Heterogeneous Preferences
- 1.3. Theory (1/4)
- 1.3. Theory (2/4)
- 1.3. Theory (3/4)
- 1.3. Theory (4/4)
- 1.4. Empirical Results: Facts Relevant to Predictions from Theory (1/2)
- 1.4. Empirical Results: Facts Relevant to Predictions from Theory (2/2)
- 1.5. Technological Change, Fixed Costs, and Preference Externalities
- Acknowledgments
- References
- Chapter 2: The Advertising-Financed Business Model in Two-Sided Media Markets
- 2.1. Introduction
- 2.2. Cast of Characters
- 2.3. Equilibrium Analysis of Single-Homing Viewers/Readers/Listeners/Surfers (1/4)
- 2.3. Equilibrium Analysis of Single-Homing Viewers/Readers/Listeners/Surfers (2/4)
- 2.3. Equilibrium Analysis of Single-Homing Viewers/Readers/Listeners/Surfers (3/4)
- 2.3. Equilibrium Analysis of Single-Homing Viewers/Readers/Listeners/Surfers (4/4)
- 2.3.1. The Ad Revenue/Subscription Revenue Balance
- 2.3.2. Representative Consumer Models
- 2.3.3. Competitive Bottlenecks
- 2.3.4. See-Saw Effects in Media Markets
- 2.3.5. Heterogeneous Ad-Nuisance Costs, Price Discrimination, and TiVo
- 2.3.6. Market Failures in Advertising Finance
- 2.3.7. Alternative Equilibrium Concepts: Price Versus Quantity
- 2.3.8. Consumer Information
- 2.3.9. Nonlinear Tariffs and Insulated Equilibrium
- 2.4. Multi-Homing Viewers/Readers (1/3)
- 2.4. Multi-Homing Viewers/Readers (2/3)
- 2.4. Multi-Homing Viewers/Readers (3/3)
- 2.5. Equilibrium Genre Choices (1/2)
- 2.5. Equilibrium Genre Choices (2/2)
- 2.6. Further Directions
- Acknowledgments
- References
- chapter 3: Empirical Modeling for Economics of the Media: Consumer and Advertiser Demand, Firm Supply and Firm Entry Model ...
- 3.1. Introduction
- 3.2. Audience Demand (1/3)
- 3.2. Audience Demand (2/3)
- 3.2. Audience Demand (3/3)
- 3.3. Advertiser Demand
- 3.4. The Supply Side: Choice of Prices, Ad Quantity, and Other Continuous Characteristics (1/2)
- 3.4. The Supply Side: Choice of Prices, Ad Quantity, and Other Continuous Characteristics (2/2)
- 3.5. The Supply Side: Positioning and Entry
- 3.6. Future Challenges
- References
- Chapter 4: Advertising in Markets
- 4.1. Introduction
- 4.2. Search and Advertising (1/4)
- 4.2. Search and Advertising (2/4)
- 4.2. Search and Advertising (3/4)
- 4.2. Search and Advertising (4/4)
- 4.3. Product Advertising (1/5)
- 4.3. Product Advertising (2/5)
- 4.3. Product Advertising (3/5)
- 4.3. Product Advertising (4/5)
- 4.3. Product Advertising (5/5)
- 4.4. Advertising as a Signal (1/2)
- 4.4. Advertising as a Signal (2/2)
- 4.5. Advertising Technology (1/2)
- 4.5. Advertising Technology (2/2)
- 4.6. Advertising that Might Not Inform (1/3)
- 4.6. Advertising that Might Not Inform (2/3)
- 4.6. Advertising that Might Not Inform (3/3)
- 4.7. Closing Comments
- Acknowledgments
- References
- Chapter 5: Recent Developments in Mass Media: Digitization and Multitasking
- Chapter 6: Merger Policy and Regulation in Media Industries
- 6.1. Introduction
- 6.2. Price and Quantity Effects of Mergers in Two-Sided Markets (1/2)
- 6.2. Price and Quantity Effects of Mergers in Two-Sided Markets (2/2)
- 6.3. Mergers and Platforms Choice of Genres (1/2)
- 6.3. Mergers and Platforms Choice of Genres (2/2)
- 6.3.1. Maximum Versus Minimum Differentiation
- 6.3.2. Steiner (1952): Mergers May Reduce Duplication of Genres
- 6.3.3. Consumers Have Second Preferences
- 6.3.4. Advertising Effect Differs Between Genres
- 6.3.5. Dual Source of Financing: Charging Both Users and Advertisers
- 6.3.6. Imperfect Competition in the Product Market
- 6.3.7. Multi-Homing Consumers: Competition for Advertisers
- 6.3.8. Limits on Ownership Concentration and Media Bias
- 6.3.9. Empirical Evidence
- 6.4. Merger Control in Media Markets (1/3)
- 6.4. Merger Control in Media Markets (2/3)
- 6.4. Merger Control in Media Markets (3/3)
- 6.5. Concluding Remarks
- Acknowledgments
- References
- Chapter 1: Preference Externalities in Media Markets
- Part II: Sectors
- Chapter 7: The Economics of Television and Online Video Markets
- 7.1. Introduction
- 7.2. The Television Industry (1/5)
- 7.2. The Television Industry (2/5)
- 7.2. The Television Industry (3/5)
- 7.2. The Television Industry (4/5)
- 7.2. The Television Industry (5/5)
- 7.3. A Simple Model of the Television Market (1/2)
- 7.3. A Simple Model of the Television Market (2/2)
- 7.4. Extensions to the Simple Model: "The Four Bs" (1/4)
- 7.4. Extensions to the Simple Model: "The Four Bs" (2/4)
- 7.4. Extensions to the Simple Model: "The Four Bs" (3/4)
- 7.4. Extensions to the Simple Model: "The Four Bs" (4/4)
- 7.5. Open Policy Issues in Television Markets (1/2)
- 7.5. Open Policy Issues in Television Markets (2/2)
- 7.6. Online Video Markets (1/2)
- 7.6. Online Video Markets (2/2)
- 7.7. Conclusions
- Acknowledgments
- References
- Chapter 8: Radio
- 8.1. Introduction
- 8.2. A Brief History of the Radio Industry in the United States (1/2)
- 8.2. A Brief History of the Radio Industry in the United States (2/2)
- 8.3. Data
- 8.4. The Effects of Industry Consolidation on Market Outcomes: Theoretical Considerations
- 8.5. Empirical Evidence on the Effects of Ownership Consolidation in Radio (1/4)
- 8.5. Empirical Evidence on the Effects of Ownership Consolidation in Radio (2/4)
- 8.5. Empirical Evidence on the Effects of Ownership Consolidation in Radio (3/4)
- 8.5. Empirical Evidence on the Effects of Ownership Consolidation in Radio (4/4)
- 8.6. Excess Entry
- 8.7. Strategies for Retaining Listeners
- 8.8. Non-commercial Radio and the Effects of Competition Between Non-commercial and Commercial Broadcasters
- 8.9. Effects of Radio on the Music Industry, and Cultural and Political Outcomes (1/2)
- 8.9. Effects of Radio on the Music Industry, and Cultural and Political Outcomes (2/2)
- 8.10. Conclusions
- Acknowledgments
- References
- Chapter 9: Newspapers and Magazines
- 9.1. Introduction
- 9.2. An Overview of the Print Media Industry (1/2)
- 9.2. An Overview of the Print Media Industry (2/2)
- 9.3. Market Structure in Newspapers and Magazines (1/2)
- 9.3. Market Structure in Newspapers and Magazines (2/2)
- 9.4. Newspapers and Magazines as Two-Sided Markets (1/2)
- 9.4. Newspapers and Magazines as Two-Sided Markets (2/2)
- 9.5. Advertising in Newspapers and Magazines
- 9.6. Antitrust Issues in Newspapers and Magazines (1/2)
- 9.6. Antitrust Issues in Newspapers and Magazines (2/2)
- 9.7. Print Media and the Internet
- 9.8. Thoughts for Future Research and Conclusions
- Acknowledgments
- References
- Chapter 10: The Economics of Internet Media
- 10.1. Introduction
- 10.2. Media and Advertising on the Internet: Some Facts (1/2)
- 10.2. Media and Advertising on the Internet: Some Facts (2/2)
- 10.3. Providing Media Content (1/3)
- 10.3. Providing Media Content (2/3)
- 10.3. Providing Media Content (3/3)
- 10.4. Users Choosing Media Content (1/5)
- 10.4. Users Choosing Media Content (2/5)
- 10.4. Users Choosing Media Content (3/5)
- 10.4. Users Choosing Media Content (4/5)
- 10.4. Users Choosing Media Content (5/5)
- 10.5. Media Platforms Matching Advertising to Content (1/4)
- 10.5. Media Platforms Matching Advertising to Content (2/4)
- 10.5. Media Platforms Matching Advertising to Content (3/4)
- 10.5. Media Platforms Matching Advertising to Content (4/4)
- 10.6. Media Platforms Matching Advertising to Users (1/3)
- 10.6. Media Platforms Matching Advertising to Users (2/3)
- 10.6. Media Platforms Matching Advertising to Users (3/3)
- 10.7. Conclusion
- Acknowledgments
- References
- Chapter 7: The Economics of Television and Online Video Markets
- Index (1/2)
- Index (2/2)
- Back Cover
CHAPTER 6
Merger Policy and Regulation
in Media Industries
Øystein Foros, Hans Jarle Kind, Lars Sørgard
NHH Norwegian School of Economics, Bergen, Norway
Contents
6.1. Introduction 226
6.2. Price and Quantity Effects of Mergers in Two-Sided Markets 228
6.2.1 Backdrop: Price and Quantity Effects of Mergers in One-Sided Markets 229
6.2.2 Two-Sided Markets and Single-Homing Consumers 230
6.2.3 Two-Sided Markets and Multi-Homing Consumers 231
6.2.4 Effects of Semi-Collusion Through Joint Operating Agreements 235
6.3. Mergers and Platforms’ Choice of Genres 236
6.3.1 Maximum Versus Minimum Differentiation 237
6.3.2 Steiner (1952): Mergers May Reduce Duplication of Genres 237
6.3.3 Consumers Have Second Preferences 239
6.3.4 Advertising Effect Differs Between Genres 239
6.3.5 Dual Source of Financing: Charging Both Users and Advertisers 239
6.3.6 Imperfect Competition in the Product Market 240
6.3.7 Multi-Homing Consumers: Competition for Advertisers 241
6.3.8 Limits on Ownership Concentration and Media Bias 242
6.3.9 Empirical Evidence 242
6.4. Merger Control in Media Markets 244
6.4.1 The Method Used by Antitrust Authorities 244
6.4.1.1 The Traditional Approach 244
6.4.1.2 An Extension to a Two-Sided Market 247
6.4.2 The Possible Price Effect of Media Mergers 250
6.4.2.1 Merger Control: Some Examples 251
6.4.2.2 Empirical Studies 255
6.4.3 The Possible Non-Price Effect of Media Mergers 257
6.5. Concluding Remarks 258
Acknowledgments 261
References 261
Abstract
The aim of this chapter is to survey the media economics literature on mergers. In particular, we try to
accentuate where the effects of mergers differ between conventional one-sided markets and two-sided
media markets (though not all media mergers are within two-sided markets). We focus on price effects
in the first part of the chapter, and in the second part we discuss how mergers affect competing media
225
Handbook of Media Economics,Volume1A © 2016 Elsevier B.V.
ISSN 2213-6630,
http://dx.doi.org/10.1016/B978-0-444-62721-6.00006-8 All rights reserved.
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