Research On Pricing Strategy Of TV-Media Based On Two-sided Market Theory

TV media is a typical platform of enterprise with the feature of bilateral market, not only taking on its common feature but also having the specialty of media industries. The mass of TV viewers find advertisements to be a nuisance, which makes cross-network externalities from increase of advertisers subtractive.This paper analyses the three media pricing strategies by building a monopoly media model with bilateral vertical product differentiation in view of cross-network externalities:unilateral pricing strategies paid by viewers,unilateral pricing strategies paid by advertisers and paid by both. By means of discussing the three pricing strategies in TV media and investigating the optimal pricing strategy and the optimal choice, we can come to conclusion:the choice of media pricing and prices for advertising is affected by disgusting advertisement cost from viewers and the unit-network marginal effect from advertisers. Moreover, the number of advertisers is a key determinant whether the unilateral strategy is adopted. No matter what the price strategy is, the number of TV viewers is always proportional to the profits of TV media.