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Advertising Rates, Audience Composition, and Competition in the Network Television Industry

Author

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  • Goettler, R.

Abstract

We discuss the market for commercial spots on network television and estimate the relationship between ratings and advertisement revenue. Then we discuss the model of viewer choice and scheduling strategies suggested by the model and we compute best response schedules and Nash equilibria of the scheduling game and analyze the strategic behavior of the television networks under various specifications of the payoff function.

Suggested Citation

  • Goettler, R., 1999. "Advertising Rates, Audience Composition, and Competition in the Network Television Industry," GSIA Working Papers 1999-28, Carnegie Mellon University, Tepper School of Business.
    • Handle: RePEc:cmu:gsiawp:1999-28
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    Citations

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    Cited by:

    1. Anderson, Simon P. & Gabszewicz, Jean J., 2006. "The Media and Advertising: A Tale of Two-Sided Markets," Handbook of the Economics of Art and Culture, in: V.A. Ginsburgh & D. Throsby (ed.), Handbook of the Economics of Art and Culture, edition 1, volume 1, chapter 18, pages 567-614, Elsevier.
    2. Simon P. Anderson & Bruno Jullien, 2015. "The advertising-financed business model in two-sided media markets," Post-Print hal-02866192, HAL.
    3. Pepall, Lynne M. & Richards, Daniel J., 2006. "Advertising and bidding for television rights," Economics Letters, Elsevier, vol. 90(2), pages 237-241, February.
    4. Sylvia Hristakeva & Julie Holland Mortimer, 2023. "Price Dispersion and Legacy Discounts in the National Television Advertising Market," Marketing Science, INFORMS, vol. 42(6), pages 1162-1183, November.
    5. Gomes, Orlando, 2006. "The dynamics of television advertising with boundedly rational consumers," MPRA Paper 2847, University Library of Munich, Germany.
    6. Nilssen, Tore & Sørgard, Lars, 2000. "TV Advertising, Program Quality, and Product-Market Oligopoly," Competition Policy Center, Working Paper Series qt2zp943hj, Competition Policy Center, Institute for Business and Economic Research, UC Berkeley.
    7. Itai Sher & Jeremy T. Fox & Kyoo il Kim & Patrick Bajari, 2011. "Partial Identification of Heterogeneity in Preference Orderings Over Discrete Choices," NBER Working Papers 17346, National Bureau of Economic Research, Inc.
    8. Sharma, Priyanka & Wagman, Liad, 2020. "Advertising and Voter Data in Asymmetric Political Contests," Information Economics and Policy, Elsevier, vol. 52(C).
    9. Chiou, Lesley & Tucker, Catherine, 2013. "Paywalls and the demand for news," Information Economics and Policy, Elsevier, vol. 25(2), pages 61-69.
    10. Ronald Goettler & Ron Shachar, 2000. "Estimating Product Characteristics and Spatial Competition in the Network Television Industry," Econometric Society World Congress 2000 Contributed Papers 1691, Econometric Society.
    11. Kenneth C. Wilbur, 2008. "A Two-Sided, Empirical Model of Television Advertising and Viewing Markets," Marketing Science, INFORMS, vol. 27(3), pages 356-378, 05-06.
    12. Richard Schmidtke, 2006. "Two–Sided Markets with Pecuniary and Participation Externalities," Working Papers 003, Bavarian Graduate Program in Economics (BGPE).
    13. Keith Brown & Roberto Cavazos, 2005. "Why is This Show so Dumb? Advertising Revenue and Program Content of Network Television," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 27(1), pages 17-34, August.
    14. Mihai Banciu & Esther Gal-Or & Prakash Mirchandani, 2010. "Bundling Strategies When Products Are Vertically Differentiated and Capacities Are Limited," Management Science, INFORMS, vol. 56(12), pages 2207-2223, December.
    15. Leonard I. Nakamura, 2005. "Advertising, intangible assets, and unpriced entertainment," Working Papers 05-11, Federal Reserve Bank of Philadelphia.
    16. Nilssen,T. & Sorgard,L., 2001. "The TV industry : advertising and programming," Memorandum 18/2001, Oslo University, Department of Economics.
    17. Robert Seamans & Feng Zhu, 2010. "Technology Shocks in Multi-Sided Markets: The Impact of Craigslist on Local Newspapers," Working Papers 10-11, NET Institute.
    18. Germa Bel & Laia Domenech, 2009. "What Influences Advertising Price in Television Channels?: An Empirical Analysis on the Spanish Market," Journal of Media Economics, Taylor & Francis Journals, vol. 22(3), pages 164-183.

    More about this item

    Keywords

    ADVERTISING ; TELEVISION;

    JEL classification:

    • M30 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - General
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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