This paper considers a typical ad-supported online video platform with two interacting revenue streams: ad display and ad-free subscription. In practice, ad display and ad-free subscription serve different customers and are typically operated by separate divisions. Within this context, there is clearly a need for the platform to align the decentralized pricing for two interacting services. Motivated by this practical problem, this paper proposes an easy and operable coordination mechanism for the platform to coordinate the division-level pricing to maximize its total revenue. We first model the pricing under both centralized and decentralized settings. The derived equilibrium reveals that, contrary to typical negative relationships between price and demand in one-sided and most two-sided markets, a positive relationship (higher ad-free subscription fees lead to more advertising on the other side) is observed on this platform. If this indirect relationship is ignored, decentralized pricing will always underprice ad-free subscription. We then propose an easy-to-implement coordination mechanism consisting of customer-oriented subsidies and fees for the platform to maximize the total revenue. Our analysis shows the proposed coordination can be self-financed as long as the ad-watching cost is relatively low or the advertiser base is relatively large. These findings not only apply to online video platforms, but to any digital platform generating interacting revenue streams from both sides, such as online gaming platforms.
中文翻译:
本文考虑了一个典型的广告支持的在线视频平台,该平台具有两个相互作用的收入来源:广告展示和无广告订阅。实际上,广告展示和无广告订阅服务于不同的客户,并且通常由不同的部门运营。在这种背景下,平台显然需要调整两种交互服务的去中心化定价。受这一实际问题的启发,本文提出了一种简单易操作的平台协调机制,协调部门级定价以实现总收入最大化。我们首先在集中式和分散式设置下对定价进行建模。得出的均衡表明,与单边市场和大多数双边市场中价格与需求之间典型的负关系相反,在该平台上观察到一种正关系(较高的无广告订阅费导致另一方有更多广告) 。如果忽略这种间接关系,去中心化定价将始终低于无广告订阅的价格。然后,我们提出了一种易于实施的协调机制,包括以客户为导向的补贴和平台费用,以最大化总收入。我们的分析表明,只要广告观看成本相对较低或广告商基数相对较大,拟议的协调就可以自筹资金。这些发现不仅适用于在线视频平台,也适用于任何从双方产生互动收入流的数字平台,例如在线游戏平台。