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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. Mark Armstrong, 2005. "Competition in Two-Sided Markets," Industrial Organization 0505009, EconWPA.
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  7. Mark Armstrong & Helen Weeds, 2005. "Public Service Broadcasting in the Digital World," Industrial Organization 0507010, EconWPA.
  8. 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.
  9. Victor Ginsburgh & David Throsby, 2006. "Handbook of the Eonomics of Art and Culture," ULB Institutional Repository 2013/152412, ULB -- Universite Libre de Bruxelles.
  10. Rochet, Jean-Charles & Tirole, Jean, 2005. "Two-Sided Markets : A Progress Report," IDEI Working Papers 275, Institut d'Économie Industrielle (IDEI), Toulouse.
  11. 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.
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  17. Jack H. Beebe, 1977. "Institutional Structure and Program Choices in Television Markets," The Quarterly Journal of Economics, Oxford University Press, vol. 91(1), pages 15-37.
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