1. Discussion by Elena Argentesi University of Bologna
Exclusive vs overlapping viewers: Two-sided multi-homing in media markets
Discussion by Elena Argentesi
University of Bologna
Conference on “Competition Policy in Two-Sided Markets” Toulouse, 1 July 2006

2. Summary of the paper Objective of the paper
Analyse advertising choices by broadcasters in a context of multi-homing viewers.
The model
Similar to Anderson and Coate (2005), but:
● multi-homing viewers
● exogenous programming choice
● homogeneous advertisers
● three platform ownership structures: discriminating monopoly, non-discriminating monopoly, duopoly
 Main insight: more advertising (with respect to the case of exclusive viewers) in order to reduce the overlap in viewership.

3. Comments The model: ● What it the time span in which viewers switch?
 Case t’=t” ( ω=ω’)
● Static vs dynamic model: would it not be more realistic to model switching of viewers between channels in a dynamic way? (extension in Anderson and Coate, 2005)
● Programming choice exogenous: welfare implications
● Is the marginal value of advertising spots really decreasing?  empirical evidence

4. Comments Application (1):
● German broadcasting market:
- your model would predict that moving the program content closer to the competitors’ content lower profits  why doing it then?
- how does your model work with n firms like here?
- again, difficult to motivate within a model of exogenous program choice
- Alternative explanations: targeted advertising (younger viewers more valuable to advertisers); viewers not uniformly distributed

5. Comments Application (2): ● ITV premium puzzle
- was there really an increase in advertising volumes or only in prices?
- Does it not depend more on the choice of programming (mass programs)?