Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/198895
Authors: 
Carroni, Elias
Madio, Leonardo
Shekhar, Shiva
Year of Publication: 
2019
Series/Report no.: 
CESifo Working Paper No. 7535
Abstract: 
This article studies incentives for a premium provider (Superstar) to offer exclusive contracts to competing platforms mediating the interactions between consumers and firms. When platform competition is intense, more consumers subscribe to the platform hosting the Superstar exclusively. This mechanism is self-reinforcing as firms follow consumer decisions and (some) join exclusively the platform with the Superstar. Exclusivity always benefits firms and may benefit consumers. Moreover, when the Superstar is integrated with a platform, non-exclusivity becomes more likely than if the Superstar was independent. This analysis provides several implications for managers and policy makers operating in digital and traditional markets.
Subjects: 
exclusive contracts
platforms
two-sided markets
ripple effect
content providers
market power
JEL: 
L13
L22
L86
Document Type: 
Working Paper

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