Competitive Viability And Scale Economy

City newspaper in China, since its birth until the year 2004, had triumphantly been a substantial driving force for the development of national newspaper publishing industry, and meanwhile it is also the most part in own-expense market and advertising market of newspaper. However, in 2005 city newspaper met a turning point, its continuous upward trend vanished, and entered into "a general decline parabolic orbit". Problems which were covered up by rapid development now appear. For instance, the social barrier for entry and local protectionism, which are hard to overcome, do affect the resource of city newspaper to flow. Meanwhile, withdrawal mechanism of city newspaper is not sound. Because of the absence of the special law for the city newspaper to get out the market, people can not effectively reduce the exit barriers. Most times the troubled city newspaper has to withdraw with the help of administrative order. From the view of differentiation, the market positions of most city newspapers has trivial differences, the product homogenization is very serious, and therefore the differences have yet played a role in adjusting market structure. And about market activity, the dominant and implicit price war of city newspaper is distinguished. Unfair competition exists in some markets. And also, city-Newspaper resources have not been fully utilized, profit indicators are declining. The emergence of such problems is not only because of Internet and other new media which are taking away paper media audiences and advertising resources, the reasons are more likely on the industry of city newspaper itself.This study focuses issues emerge during the development of city newspaper. And it is the first domestic research that pays attention to industry organization, relations between SCP and the optimization of industrial strategy from the perspective of industry organization theory to make comprehensive and systematic analysis and construction. What the author hope to achieve through this study is to lead the city newspapers in Chinese city Newspaper Industry Organization competite correctly, and to improve city-newspaper market structure and promote performance level ofChinese city-newspaper market, and make the industry to develop in a healthy, sustainable and stable way.First, this papers make a comprehensive analysis for the Chinese city newspaper industry organization - the market structure, market behavior and market perfit. Market structure is presented and introduced by the analysis of market concentration, entry barriers, exit barriers and product differentiation, which are elements of market structure of Chinese city newspaper. The conclusion is that the market concentration of Chinese city-newspaper is low, while economic barriers is rising and the function of legal barriers of policy for entry is falling and withdraw are too high, and the differentiation of city newspaper products is not distinguished. The author also analyzes the reason and result of above conclusions. The situation of market behavior is presented through analyses on market dominant position, price and transregional acts of China's city newspaper. The conclusions is that the dominant position of city newspaper in market is not yet clear, the price competition is excessive, and cross-boundary operations are difficult. to last, the author interpreted market performance of China's city newspaper from three perspectives. First, from a macro perspective, the author realizes that China's city newspaper industry has a negative externality and imbalance in content. Second, from a industrial perspective, the author think the geographical distribution of China's city newspaper is irrational, and there are also problems of waste of resources within certain areas which are caused by the poor mobility of resources. Third, from the business perspective, the author presents the fact that the distribution of China's city newspapers now is in the state of embarrassment and profits are gradually declining.Secondly, the author describes the transmission mechanism between SCP of China's city newspaper, and the futural optimization of indurstrial organizations of city newspaper. First, this paper presents the view that it is the oligopoly structure and high legal entry barriers cause the price competition and cross-area operation. Meanwhile, the price competition and cross-area operation do affected market prices of some city newspaper markets. Excessive price competition and difficulties in cross-area operation also cause poor market performance of China's city newspaper.Meanwhile, such poor market performance further affect the enthusiasm of price competition and cross-area operation. Thus established a two-way relationship between the above three factors. Among them, the power of positive link is stronger than the reverse links. Second, the author presents his opinion of establishing target model from four aspects according to the relationship between SCP of China's city newspaper.Finally, This paper present a strategy for optimizing the organization of city newspaper from three dimensions——adjusting managing policy of government on city newspaper industry, adjusting the market structure and market behavior of city newspaper industry. In first strategy the author analyzes the current state of China's managing policy on the said issue and put forward the view that government should change its functions, relax the control, and divide the control policy into news control policy and industry organization policy, and at last bring a concete stategy to enhance the optimization of industrial organization of China's city newpaper. Second, the paper launches a theoritical analysis on whether city-newspaper, which has monoplistic characteristics, can achieve optimization of market structure and effective competition. Then present the view that the goal of market structure of China's city newspaper is to establish an appropriately monoplistic market structure. The conclusion is people shound reach the ideal target market structure through three pathes : one is to increase market concentration; second, reducing the high social barriers of entry; the third path is to reduce the high exit barriers. Third, the auther present the idea that the principal status of city-newspaper in market can be obtained through the definitude of property and formation of modern managing structure. And the economies of scale can be promoted by multi-media operation (ideas on how to carry out multi-media operation are also presented here). In addition, people can also find in this paper a number of useful ideas about price competition and other competitions between various city-newspapers.