Cuntz and Bergquist (2020)
|Cuntz and Bergquist (2020)|
|Title:||Exclusive content and platform competition in Latin America|
|Author(s):||Cuntz, A, Bergquist, K|
|Citation:||[[Has full citation::Cuntz, A., & Bergquist, K. (2020). Exclusive Content and Platform Competition in Latin America [Working Paper]. Economic Research Working Paper No. 63. WIPO]]|
|Link(s):||Definitive , Open Access|
|Key Related Studies:|
|About the Data|
|Data Description:||The study’s samples contain data compiled from a number of sources:
• Monthly information on availability of individual movie titles for each platform from Justwatch.com, with extensive catalogue information from 17 different platforms operating in Brazil over 45-months (from May 2016 to January 2019). The Justwatch sample covers almost 20,000 titles in total, with information about the business model (SVOD/TVOD), cinematic/online release date, quality and pricing of individual content, where applicable.
• Information from “the movie database” (tmdb).
• Weekly information on piracy searches for individual titles from Google trends (gtrends R package), keywords such as “streaming”, “full movie” and “download” (and their Portuguese equivalents) were excluded.
• Data from muso.com, with information on streaming and site activity around different media on a global scale, including information on the way these sites are accessed and which technologies are mostly used to access media content (from January 2017 to 2019).
• Data from Kinomatics project, with comprehensive information on the cinematic distribution of movies in Brazil and the global distribution of Brazilian and Portuguese production and language film.
|Data Type:||Secondary data|
|Secondary Data Sources:|
|Data Collection Methods:|
|Data Analysis Methods:|
|Cross Country Study?:||No|
|Government or policy study?:||No|
|Time Period(s) of Collection:||
“Platforms often compete over non-price strategies such as the exclusive distribution of products. But these strategies are not always welfare-enhancing. Using rich data on audiovisuals distributed on platforms in Brazil, we find that non-exclusive distribution and availability of titles across platforms is more effective in deterring online piracy than in the singlehoming case. Moreover, in certain markets (TVOD), it induces higher average investment in the production of new titles upstream. We discuss options of copyright and antitrust policies in the light of these findings.”
Main Results of the Study
• First, the study shows that, once movie titles become available on SVOD platforms, piracy searches of these titles drop on the Internet. If these titles are available on three or more platforms, the relative decline in piracy search is almost twice in magnitude, when compared to titles that are available on only one platform (exclusive content). • Different from TVOD markets, movie budgets of SVOD titles tend to increase with more exclusive licenses. Thus, exclusivity in SVOD titles results in more investment in quality and premium content in this market. Therefore, the increase in investment resulted from exclusive windowing of SVOD titles might compensate the greater exposure to piracy of this kind of content. However, the same rationale does not apply to TVOD titles, where there seems to exist a negative causal effect between exclusivity and investments.
Policy Implications as Stated By Author
From a policy perspective, the author argues that, as well as legal service availability that in general has a positive effect in deterring online piracy, content availability on multiple platforms can have an even greater effect. However, there might exist a potential market failure in this case. Even though distributing platforms and sellers might benefit from a decrease in online piracy, SVOD platforms might opt for continuing to compete over exclusive content. Therefore, the author suggests that there are multiple market and legal mechanisms that can be considered to overcome this issue (e.g., compulsory licensing regimes, FRAND licensing rules, factoring in exclusive dealings in vertical and horizontal merger control; or consumer policy) . Furthermore, the author claims that the research provides quantitative evidence that a film investment can be tied to multiple platforms distribution in certain markets, such as TVOD. This situation contradicts one of copyright policy’s main goals, which usually aims to incentivize more investment by granting exclusive rights.
Coverage of Study