Revenue and Lifecycle Management for Digital Media Networks

Abstract

Lifecycle management of digital media objects such as online videos is a challenging problem. While media objects are strong sources of revenue to content providers they also have limited shelf-life, influence each other in terms of customer choices, are data-intensive and require large bandwidth for delivery. As the revenue priorities often change rapidly, tiered solutions emerge as necessary and viable tools for lifecycle management. We model digital media objects as a network capturing the inter-object impacts and utilize this network structure to optimally partition media objects into tiers. Addressing the context of large content providers like Amazon VOD that employ infrastructure platforms like Limelight for content storage and delivery, we develop a bilevel programming model to maximize the profits of a price-setting platform and a tiered allocation-setting content provider. We predict and observe two fundamental effects with digital media: direct access differential revenue effect of tiered services and traffic generating effect of media objects. Using a detailed longitudinal empirical study we demonstrate the effectiveness of the proposed pricing and provisioning strategy and illustrate the existence and impact of these effects in media markets.