Header

UZH-Logo

Maintenance Infos

The welfare effects of vertical integration in multichannel television markets


Crawford, Gregory; Lee, Robin S; Whinston, Michael; Yurukoglu, Ali (2017). The welfare effects of vertical integration in multichannel television markets. CEPR Discussion Papers 11202, Centre for Economic Policy Research.

Abstract

We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm welfare due to foreclosure and incentives to raise rivals' costs. We estimate a structural model of viewership, subscription, distributor pricing, and affiliate fee bargaining using a rich dataset on the U.S. cable and satellite television industry (2000-2010). We use these estimates to analyze the impact of simulated vertical mergers and divestitures of RSNs on competition and welfare, and examine the efficacy of regulatory policies introduced by the U.S. Federal Communications Commission to address competition concerns in this industry.

Abstract

We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm welfare due to foreclosure and incentives to raise rivals' costs. We estimate a structural model of viewership, subscription, distributor pricing, and affiliate fee bargaining using a rich dataset on the U.S. cable and satellite television industry (2000-2010). We use these estimates to analyze the impact of simulated vertical mergers and divestitures of RSNs on competition and welfare, and examine the efficacy of regulatory policies introduced by the U.S. Federal Communications Commission to address competition concerns in this industry.

Statistics

Downloads

6 downloads since deposited on 22 Dec 2017
6 downloads since 12 months
Detailed statistics

Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
JEL Classification:L13, L42, L51, L82
Uncontrolled Keywords:Cable television; double marginalization; foreclosure; vertical integration
Language:English
Date:November 2017
Deposited On:22 Dec 2017 11:44
Last Modified:19 Feb 2018 09:49
Series Name:CEPR Discussion Papers
Number of Pages:78
ISSN:0265-8003
OA Status:Green

Download

Download PDF  'The welfare effects of vertical integration in multichannel television markets'.
Preview
Content: Published Version
Filetype: PDF (Aktualisierte version)
Size: 1MB