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Frontiers: The Interplay of User-Generated Content, Content Industry Revenues, and Platform Regulation: Quasi-Experimental Evidence from YouTube

Author

Listed:
  • Nils Wlömert

    (Institute for Retailing & Data Science, Vienna University of Economics and Business, 1020 Vienna, Austria)

  • Dominik Papies

    (School of Business and Economics and member of the Machine Learning Cluster of Excellence, University of Tuebingen, 72074 Tuebingen, Germany)

  • Michel Clement

    (Institute of Marketing, University of Hamburg, 20148 Hamburg, Germany)

  • Martin Spann

    (LMU Munich School of Management, Ludwig-Maximilians-Universität München, 80539 Munich, Germany)

Abstract

An ongoing debate among firms, rightsholders, particularly in the music industry, and policymakers in the United States and the European Union concerns potential changes to the regulation of user-generated content (UGC) video streaming platforms (e.g., YouTube). Currently, safe harbor provisions protect platforms from liability for copyright-infringing content uploaded by users, and requirements for compensating rightsholders for UGC are weak, resulting in comparatively low payouts. At the same time, it is unclear how a change in these regulations would affect consumer demand for this content on other platforms with higher payouts (e.g., Spotify), that is, whether UGC platforms stimulate or displace demand on other platforms. We study a quasi-experiment that occurred when numerous songs became available as UGC on YouTube after an agreement between YouTube and the German royalty collecting society. Our analysis of an unprecedented data set covering 600,000 songs by 38,000 artists reveals an intriguing finding: Although UGC availability stimulates demand in other streaming channels for most songs, cannibalization occurs for recent releases and hit releases, turning the overall revenue effect negative. We discuss how policymakers can use these findings to understand the implications of changes in regulation, and how labels and artists can decide which content to block or allow on UGC platforms.

Suggested Citation

  • Nils Wlömert & Dominik Papies & Michel Clement & Martin Spann, 2024. "Frontiers: The Interplay of User-Generated Content, Content Industry Revenues, and Platform Regulation: Quasi-Experimental Evidence from YouTube," Marketing Science, INFORMS, vol. 43(1), pages 1-12, January.
    • Handle: RePEc:inm:ormksc:v:43:y:2024:i:1:p:1-12
    DOI: 10.1287/mksc.2022.0080
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    References listed on IDEAS

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