Platform Mergers: Lessons from a Case in the Digital TV Market

49 Pages Posted: 29 Apr 2018 Last revised: 20 Apr 2021

See all articles by Jiekai Zhang

Jiekai Zhang

Hanken School of Economics; Helsinki Graduate School of Economics

Marc Ivaldi

Toulouse School of Economics; Centre for Economic Policy Research (CEPR)

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Date Written: April 12, 2018

Abstract

We contribute to the analysis of mergers in two-sided markets, in which a platform provides its service for free on one side but obtains all its revenues from the other. A structural model allowing for multi-homing of advertisers is developed to assess a decision of the French competition authority, which approves the merger of the broadcasting services of TV channels but prohibits the merger of their advertising sales services through a behavioral remedy. We show that ignoring the interaction between the two sides of platforms in designing competition or regulatory policy can result in unexpected outcomes.

Keywords: merger, remedy, two-sided market, platform, TV, advertising

JEL Classification: K21, L10, L40, L82, M37

Suggested Citation

Zhang, Jiekai and Ivaldi, Marc, Platform Mergers: Lessons from a Case in the Digital TV Market (April 12, 2018). Available at SSRN: https://ssrn.com/abstract=3161342 or http://dx.doi.org/10.2139/ssrn.3161342

Jiekai Zhang (Contact Author)

Hanken School of Economics ( email )

PB 287
Helsinki, Vaasa 65101
Finland

Helsinki Graduate School of Economics ( email )

P.O. Box 17 (Arkadiankatu 7)
Helsinki, FI00014
Finland

Marc Ivaldi

Toulouse School of Economics ( email )

Manufacture des Tabacs
21 Allee de Brienne bat. F
Toulouse Cedex, F-31000
France
+33 5 61 12 8592 (Phone)
+33 5 61 12 8637 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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