Part I. Introduction: 1. Economic perspectives Part II. Media-Dependent Entertainment: 2. Movie macroeconomics 3. Making and marketing movies 4. Financial accounting in movies and television 5. Music 6. Broadcasting 7. Cable 8. Publishing and New Media 9. Toys and Games Part III. Live Entertainment: 10. Gaming and wagering 11. Sports 12. Performing arts and culture 13. Amusement/theme parks Part IV. Roundup: 14. Epilogue.

Entertainment Industry Economics: A Guide for Financial Analysis

Mergers can reduce costs and alter incentives about how to position products, so that theory alone cannot predict whether mergers will increase product variety. We document the effect of mergers on variety by exploiting the natural experiment provided by the1996 Telecommunications Act. We find that consolidation reduced station entry and increased the number of formats available relative to the number of stations. We find some evidence that increased concentration increases variety absolutely. Based on the programming overlap of jointly owned stations, we can infer that the effects operate through product crowding that is consistent with spatial preemption.

Do Mergers Increase Product Variety? Evidence from Radio Broadcasting

This article presents an examination of the diversity principle in communications policy. Given the Federal Communication Commission's recent emphasis on diversity as a policy objective, diversity assessments must return to the forefront of communications policy analysis. To provide an analytical framework for such research, the diversity principle is broken into three distinct components (source, content, and exposure diversity), and multiple subcomponents. In the spirit of the FCC's empirical commitment to the diversity principle, this analysis focuses on diversity as a measurable concept, with potentially interacting dimensions and numerous means of assessment.

Deconstructing the diversity principle

Contents: Preface. Part I: Theoretical Dimensions in Media Management and Economics. A.B. Albarran, Historical Trends and Patterns in Media Management Research. R.G. Picard, Historical Trends and Patterns in Media Economics. B.I. Mierzejewska, C.A. Hollifield, Theoretical Approaches in Media Management Research. S.S. Wildman, Paradigms and Analytical Frameworks in Modern Economics and Media Economics. B.A. Cherry, Regulatory and Political Influences on Media Management and Economics. Part II: Issues in Media Management and Economics. J.W. Redmond, Issues in Human Relations Management. R.J. Rizzuto, Issues in Financial Management. S.M. Chan-Olmsted, Issues in Strategic Management. A.A. Reca, Issues in Media Product Management. R.A. Gershon, Issues in Transnational Media Management. W.S. McDowell, Issues in Marketing and Branding. S.M. Chan-Olmsted, Issues in Media Management and Technology. P.M. Napoli, Issues in Media Management and Public Interest. D.A. Ferguson, Industry-Specific Management Issues. H. van Kranenburg, A. Hogenbirk, Issues in Market Structure. J. Dimmick, Media Competition and Levels of Analysis. T. Chambers, H.H. Howard, The Economics of Media Consolidation. D. Waterman, The Economics of Media Programming. B.J. Bates, K.S. Albright, Issues in Network/Distribution Economics. M.O. Wirth, Issues in Media Convergence. A. SAnchez-Tabernero, Issues in Media Globalization. P. Graham, Issues in Political Economy. Part III: Analytical Tools in Media Management and Economics. R.A. Beam, Quantitative Methods in Media Management and Economics. G. Doyle, S. Frith, Methodological Approaches in Media Management and Media Economics Research. C.A. Hollifield, A.J. Coffey, Qualitative Research in Media Management and Economics. G.W. Ozanich, Media Finance and Valuation. P.F. Phalen, Audience Research and Analysis. Part IV: Future Directions in Media Management and Economics. D. Shaver, M.A. Shaver, Directions for Media Management Research in the 21st Century. S. Lacy, J.M. Bauer, Future Directions for Media Economics Research. D.H. Goff, Global Media Management and Economics.

Handbook of Media Management and Economics

This article shows that mergers between close competitors in the music radio industry lead to important changes in product positioning. Firms that buy competing stations tend to differentiate them and, consistent with the firm wanting to reduce audience cannibalization, their combined audience increases. However, the merging stations also become more like competitors, so that aggregate variety does not increase, and the gains in market share come at the expense of other stations in the same format. The results shed light on the effects of mergers and, more broadly, how multi-product firms may use product positioning as a competitive tool.

/pdf/the-effects-of-mergers-on-product-positioning-evidence-from-51fwtvk178.pdf

The Effects of Mergers on Product Positioning: Evidence from the Music Radio Industry

I. INTRODUCTION In the last 50 years, theorists have developed several hypotheses on the links between market structure, product diversity, and audience size in mass media markets. Theoretical models suggest that these links are especially important in advertiser-financed broadcast programming such as radio. The seminal paper by Steiner (1952) and more general models by Spence and Owen (1977) demonstrate that advertiser-supported media are likely to discriminate against programming aimed at small audiences. Empirical work by Haring (1975) and Borenstein (1986) support these conclusions in the radio sector. (However, the results in these papers are more narrowly focused than the results reported here, and no corresponding analyses of broadcast television exist.) In advertiser-supported media, the primary incentive of the firms is to deliver the largest possible audience to the client. Consequently, even though a small group may place a much higher total value on its preferred programming than does a large group, the media firms will cater to the latter. With advertiser-supported media, listener or viewer willingness-to-pay does not count. As the number of media firms grows, however, many firms have to share the popular programming types. In this situation, the profitability of reaching a small audience with a "minority" taste may be greater than that of reaching a small portion of a large audience with more "common" preferences. Thus, ceteris paribus, increasing the number of stations within a market may increase programming diversity, thereby raising the likelihood that "minority" demands will be met. This paper first examines the relationship between the number of programming formats and the number of advertiser-supported radio stations, testing the hypothesis of Steiner and others that increasing the number of stations will increase programming diversity. Furthermore, this relationship may be used to construct a link between the size of the radio audience - i.e., listenership - and the number of stations. Assessing the format effects of increasing the number of stations has implications for recent proposals by the Federal Communications Commission (FCC) and Congress to loosen rules on multi-station ownership (see FCC, 1991a). In the past, the FCC has restricted ownership of multiple radio and television stations in order to foster competition and diversity. The FCC presently limits the number of radio stations owned by one firm to one AM, FM, or AM/FM combination in any given market and to 14 of either type for the entire country (see Besen et al., 1984, pp. 21-30). Recently, however, the financial plight of AM radio stations has suggested to the FCC that its pursuit of viewpoint diversity through ownership restrictions may have been excessive, denying these stations efficiency benefits that may have increased their survival prospects. If the current rules prevent owners from attaining any cost savings arising from common ownership, relaxing the rules will permit some stations that otherwise would fall silent to remain on the air (see FCC, 1991b, paragraph 4; Anderson and Woodbury, 1988). If program diversity increases with the number of stations, then more permissive ownership policies will foster program diversity by enabling some stations that otherwise would fail to remain financially viable. The empirical research in this paper permits inferences regarding the order of magnitude of the rule-induced increase in the number of stations required to effect significant changes in diversity. The analysis permits one to conclude only whether the effects of the proposed rule change must be "small" or "large" to result in quantitatively important increases in diversity. Estimating the effect of the rule on the number of stations, on format responsiveness, and on program quality is beyond the scope of this paper. To help establish a link between diversity and consumer welfare, the analysis estimates a second relationship, that between total audience size (listenership) and diversity, as reflected in the number of formats offered in a given local market. …

Market structure, program diversity, and radio audience size

This note describes the implementation of the hypothetical monopolist ssnip test for market definition in the context of merger cases where firms produce multiple differentiated products. The test developed here represents an extension and generalization of the Katz-Shapiro and O'Brien-Wickelgren market definition test for the case of multi-product firms. We present and explain this test with an illustrative example. In the Appendix, we provide a more general and technical description of the test.

Implementing the Hypothetical Monopolist SSNIP Test with Multi-Product Firms

On March 20, 2011, wireless provider AT&T announced its intention to merge with T-Mobile USA, a competing wireless provider This article reviews the economic analysis of this proposed acquisition that we carried out for Sprint and explains why the merger would have been anticompetitive We analyze how the merger would have led to adverse unilateral, coordinated and exclusionary effects AT&T and T-Mobile contended that their proposed merger would not adversely affect competition in wireless services because T-Mobile USA was not an effective rival, because other wireless providers could easily replace any competition that was lost as a result of the merger, and because the efficiencies from the merger would be so substantial that they would dwarf any perceived anticompetitive effects Our analysis concludes that AT&T failed to provide convincing evidence of the lack of anticompetitive effects and failed to adequately document the claimed efficiencies in a manner consistent with the Horizontal Merger Guidelines

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2045713_code594892.pdf?abstractid=2045713&mirid=5

An Economic Analysis of the AT&T-T-Mobile USA Wireless Merger

Recently, the Federal Communications Commission and the Department of Justice have imposed detailed regulatory schemes governing the contractual relationship between the commercial television networks and program suppliers. This article provides empirical evidence on the determinants of program prices that indicates that the claims underlying the adoption of these regulations are unfounded. Although the network-supplier contract appears to place obligations only on suppliers, our analysis suggests that networks assume an implicit obligation to adjust program prices in response to improved information about program performance.

John R. Woodbury

Papers

Market structure, program diversity, and radio audience size

Implementing the Hypothetical Monopolist SSNIP Test with Multi-Product Firms

An Economic Analysis of the AT&T-T-Mobile USA Wireless Merger

The Determinants of Network Television Program Prices: Implicit Contracts, Regulation, and Bargaining Power

Misregulating Television: Network Dominance and the FCC