Pricing of digital video supply chain

Free versus paid service on the direct distribution channel

Yunhyoung Kim, Jeonghoon Mo

Research output: Contribution to journalArticle

Abstract

Media publishers that have commonly relied on profits from advertisements and content sales to fund their operations are not only content providers (manufacturers) to media aggregator platforms (retailers) but are also competing service providers (rival retailers) in the digital video supply chain. Different from a traditional media supply chain, they can easily operate their own direct distribution channels in the Internet era. In the digital video supply chain, it is not clear whether commercialization of the direct distribution channel would be beneficial for the media publisher because it would decrease profits from advertisements. The choice about commercialization should be investigated thoroughly because it is closely related to the media publishers' sustainability as a public medium in a digital environment. In this study, we analyze the impacts of commercializing the direct distribution channel based on a game-theoretic approach. Specifically, we compare the profits of a media publisher with and without the commercialization of the channel from analyses of sequentially defined games. Our results show that media publishers prefer to use a free service on their direct channel if the content they provide is not highly valued. They can also choose not to provide their content to the media aggregator with a paid service.

Original languageEnglish
Article number46
JournalSustainability (Switzerland)
Volume11
Issue number1
DOIs
Publication statusPublished - 2018 Dec 21

Fingerprint

Supply chains
pricing
Profitability
video
supply
commercialization
Costs
profit
Sustainable development
Sales
Internet
distribution
services
sustainability
service provider
sales
advertisement

All Science Journal Classification (ASJC) codes

  • Geography, Planning and Development
  • Renewable Energy, Sustainability and the Environment
  • Management, Monitoring, Policy and Law

Cite this

@article{4ae5d4659cdf42c283d95488340a45ef,
title = "Pricing of digital video supply chain: Free versus paid service on the direct distribution channel",
abstract = "Media publishers that have commonly relied on profits from advertisements and content sales to fund their operations are not only content providers (manufacturers) to media aggregator platforms (retailers) but are also competing service providers (rival retailers) in the digital video supply chain. Different from a traditional media supply chain, they can easily operate their own direct distribution channels in the Internet era. In the digital video supply chain, it is not clear whether commercialization of the direct distribution channel would be beneficial for the media publisher because it would decrease profits from advertisements. The choice about commercialization should be investigated thoroughly because it is closely related to the media publishers' sustainability as a public medium in a digital environment. In this study, we analyze the impacts of commercializing the direct distribution channel based on a game-theoretic approach. Specifically, we compare the profits of a media publisher with and without the commercialization of the channel from analyses of sequentially defined games. Our results show that media publishers prefer to use a free service on their direct channel if the content they provide is not highly valued. They can also choose not to provide their content to the media aggregator with a paid service.",
author = "Yunhyoung Kim and Jeonghoon Mo",
year = "2018",
month = "12",
day = "21",
doi = "10.3390/su11010046",
language = "English",
volume = "11",
journal = "Sustainability",
issn = "2071-1050",
publisher = "MDPI AG",
number = "1",

}

Pricing of digital video supply chain : Free versus paid service on the direct distribution channel. / Kim, Yunhyoung; Mo, Jeonghoon.

In: Sustainability (Switzerland), Vol. 11, No. 1, 46, 21.12.2018.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Pricing of digital video supply chain

T2 - Free versus paid service on the direct distribution channel

AU - Kim, Yunhyoung

AU - Mo, Jeonghoon

PY - 2018/12/21

Y1 - 2018/12/21

N2 - Media publishers that have commonly relied on profits from advertisements and content sales to fund their operations are not only content providers (manufacturers) to media aggregator platforms (retailers) but are also competing service providers (rival retailers) in the digital video supply chain. Different from a traditional media supply chain, they can easily operate their own direct distribution channels in the Internet era. In the digital video supply chain, it is not clear whether commercialization of the direct distribution channel would be beneficial for the media publisher because it would decrease profits from advertisements. The choice about commercialization should be investigated thoroughly because it is closely related to the media publishers' sustainability as a public medium in a digital environment. In this study, we analyze the impacts of commercializing the direct distribution channel based on a game-theoretic approach. Specifically, we compare the profits of a media publisher with and without the commercialization of the channel from analyses of sequentially defined games. Our results show that media publishers prefer to use a free service on their direct channel if the content they provide is not highly valued. They can also choose not to provide their content to the media aggregator with a paid service.

AB - Media publishers that have commonly relied on profits from advertisements and content sales to fund their operations are not only content providers (manufacturers) to media aggregator platforms (retailers) but are also competing service providers (rival retailers) in the digital video supply chain. Different from a traditional media supply chain, they can easily operate their own direct distribution channels in the Internet era. In the digital video supply chain, it is not clear whether commercialization of the direct distribution channel would be beneficial for the media publisher because it would decrease profits from advertisements. The choice about commercialization should be investigated thoroughly because it is closely related to the media publishers' sustainability as a public medium in a digital environment. In this study, we analyze the impacts of commercializing the direct distribution channel based on a game-theoretic approach. Specifically, we compare the profits of a media publisher with and without the commercialization of the channel from analyses of sequentially defined games. Our results show that media publishers prefer to use a free service on their direct channel if the content they provide is not highly valued. They can also choose not to provide their content to the media aggregator with a paid service.

UR - http://www.scopus.com/inward/record.url?scp=85059159903&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85059159903&partnerID=8YFLogxK

U2 - 10.3390/su11010046

DO - 10.3390/su11010046

M3 - Article

VL - 11

JO - Sustainability

JF - Sustainability

SN - 2071-1050

IS - 1

M1 - 46

ER -