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Platform Siphoning: Ad-Avoidance and Media Content

  • Anderson, Simon P
  • Gans, Joshua

Content providers rely on advertisers to pay for content. TiVo, remote controls, and pop-up ad blockers are examples of ad-avoidance technologies that allow consumers to view content without ads, and thereby siphon off the content without paying the ‘price.’ We examine the content provider’s reaction to such technologies, demonstrating that their adoption increases advertising clutter (leading to a potential downward spiral), may reduce total welfare and content quality, and can lead to more mass-market content. We cast doubt on the profitability of using subscriptions to counter the impact of ad-avoidance.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 7729.

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Date of creation: Mar 2010
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Handle: RePEc:cpr:ceprdp:7729
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  1. repec:rje:randje:v:37:y:2006:3:p:668-691 is not listed on IDEAS
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  10. Beebe, Jack H, 1977. "Institutional Structure and Program Choices in Television Markets," The Quarterly Journal of Economics, MIT Press, vol. 91(1), pages 15-37, February.
  11. Simon P. Anderson & Stephen Coate, 2003. "Market Provision of Broadcasting: A Welfare Analysis," Virginia Economics Online Papers 358, University of Virginia, Department of Economics.
  12. Grabowski, Henry G & Vernon, John M, 1992. "Brand Loyalty, Entry, and Price Competition in Pharmaceuticals after the 1984 Drug Act," Journal of Law and Economics, University of Chicago Press, vol. 35(2), pages 331-50, October.
  13. Claude Crampes & Carole Haritchabalet & Bruno Jullien, 2009. "ADVERTISING, COMPETITION AND ENTRY IN MEDIA INDUSTRIES -super-* ," Journal of Industrial Economics, Wiley Blackwell, vol. 57(1), pages 7-31, 03.
  14. repec:rje:randje:v:37:y:2006:3:p:645-667 is not listed on IDEAS
  15. Jean J. Gabszewicz & Didier Laussel & Nathalie Sonnac, 2004. "Programming and Advertising Competition in the Broadcasting Industry," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 13(4), pages 657-669, December.
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