Game in Broadcasting
Industry
December 2007
Firms that provide broadcasting services are networks since they can broadcast the same programs in different locations.
Governments generally limit the concentration of
ownership to protect pluralism and democracy
Broadcasting differs from cable TV or encrypted TV. The latter can disconnect unpaying consumers from the network
Broadcasting companies cannot collect fees from
their viewers or listeners\ue000 they generate revenues
only from advertising\ue000 Revenues depend on
\u201crating\u201d (popularity, audience, number of viewers or
listeners).
Broadcasters are engaged in \u201cnon-price competition\u201d,
since they cannot sell their services.
Their goal is attracting the highest number of viewers
or listener to raise theirratin g\ue000 maximize profits
from advertising.
\ue000 Scheduling of programs becomes their most
important strategic variable.
Each group of consumers has certain hours during
which their major audience turns on their TV sets
Examples:
\ue001Soap-opera lovers (1) early in the afternoon
\ue001People interested in news (2) between 6.30 and
8.30
(1) part-time workers
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