Stitched College Willis Hurricanes Mcgahee Green Jerseys 2
Stitched College Willis Hurricanes Mcgahee Green Jerseys 2
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Stitched College Willis Hurricanes Mcgahee Green Jerseys 2

Volume 20, Issue 3

Exclusivity and Control

First published:  22 July 2011
Cited by: 38

We thank the editor, two anonymous referees, Patrick Rey, Yossi Spiegel, and seminar participants at the Fourth Bi‐annual Conference on the Economics of the Software and Internet Industries in Toulouse for helpful comments and suggestions.

Stitched College Willis Hurricanes Mcgahee Green Jerseys


We model competition between content distributors (platforms) for content providers, and show that whether or not content is exclusive or “multihomes” depends crucially on whether or not content providers maintain control over their own pricing to consumers: if content providers sell their content outright and relinquish control, they will tend to be exclusive; on the other hand, if content providers maintain control and only “affiliate” with platforms, then multihoming is sustainable in equilibrium. We show that the outcome under affiliation depends on the tradeoff between platform rent extraction (which increases in exclusivity) and content rent extraction (which increases in multihoming), and demonstrate that the propensity for exclusivity can be increasing, decreasing, or even nonmonotonic in content quality. Finally, if a content provider internalizes the effect of its own price on platform demand, we prove that a platform that already has exclusive access to content may prefer to relinquish control over content pricing to the content provider in order to reduce price competition at the platform level.

The full text of this article hosted at is unavailable due to technical difficulties.

Stitched College Willis Hurricanes Mcgahee Green Jerseys Stitched College Willis Hurricanes Mcgahee Green Jerseys