Competition in the News Industry: Fighting Aggregators with Versions and Links
36 Pages Posted: 3 Nov 2012
Date Written: September 30, 2012
We analyze the linking and versioning strategies of a media firm when facing competition from blogs, search engines and news aggregators. First, we show that when the publisher competes against a blog it is less likely to release a fighting version if this generates signi ficant spillovers for its rival. Second, we analyze situations where a publisher will accept to offer part of its contents to a news aggregator in exchange for financial compensation. We explain that an agreement is possible when the aggregator is not overly dependent on the firms contents. Finally, we show that when the firm competes against a search engine, its linking and versioning strategies depend on the amount of trace it receives from its competitor. The firm can use the search engine as its own low quality version and as a mechanism to expand its market since it gives access to many contents.
Keywords: Product segmentation, versioning, linking, media market, search engines, news aggregators, Internet
JEL Classification: D83, D85, L12, L22, L86, M31
Suggested Citation: Suggested Citation