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The new media economics of video-on-demand markets: Lessons for competition policy (updated version)

Author

Listed:
  • Budzinski, Oliver
  • Lindstädt-Dreusicke, Nadine
Abstract
The markets for audiovisual content are subject to dynamic change. Where once "traditional" (free-to-air, cable, satellite) television was dominating, i.e. linear audiovisual media services, markets display nowadays strong growth of different types of video-on-demand (VoD), i.e. nonlinear audiovisual media services, including both Paid-for VoD like Amazon Prime and Netflix and Advertised-financed VoD like YouTube. Competition policy decisions in such dynamic markets are always particularly challenging. The German competition authority was presented such a challenge when, at the beginning of the 2010s, German television providers sought to enter online VoD markets with the help of cooperative platforms. We review the antitrust concerns that were raised back then in an ex post analysis. In doing so, we first discuss the dynamic development of the German VoD markets during the last decade. In the second part of this paper, we derive four aspects, in which the previous antitrust analysis cannot be upheld from today's perspective. First, relevant implications of modern platform economics were neglected. Second, some inconsistencies in the assessment of the two projects appear to be inappropriate. Third, the emerging competitive pressure of international VoD providers was strongly underestimated. Fourth, the question of market power in online advertising markets looks very different at the end of the decade.

Suggested Citation

  • Budzinski, Oliver & Lindstädt-Dreusicke, Nadine, 2019. "The new media economics of video-on-demand markets: Lessons for competition policy (updated version)," Ilmenau Economics Discussion Papers 125, Ilmenau University of Technology, Institute of Economics.
    • Handle: RePEc:zbw:tuiedp:125
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    References listed on IDEAS

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    Cited by:

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    2. Budzinski, Oliver & Gänßle, Sophia & Kunz-Kaltenhäuser, Philipp, 2019. "How does online streaming affect antitrust remedies to centralized marketing? The case of European football broadcasting rights," Ilmenau Economics Discussion Papers 128, Ilmenau University of Technology, Institute of Economics.

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    More about this item

    Keywords

    video-on-demand; media economics; two-sided markets; competition; platform economics; commercial television; public service broadcasters; antitrust policy; YouTube; Amazon; Netflix;
    All these keywords.

    JEL classification:

    • L40 - Industrial Organization - - Antitrust Issues and Policies - - - General
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General

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