Choice of Business Model and Pricing Strategy with Ad-Sponsor and Subscription Fee
- 10.2991/lemcs-15.2015.306How to use a DOI?
- Business model; Ad-sponsor; Model; Pricing; Video website
This paper studies the strategy and best pricing tactics of two-sided platforms, and analyzes how the platforms will perform when facing both ad-sponsors and subscription fee.Researchers Researchers focus on the video websites as the research object, due to the peculiarity and negative cross-group network externalities of video websites. Based on the revenue structure and operation model, this paper considers 3 business models, including pure ad-sponsored model, pure subscription model, and a mixed model. With the help of modeling and game theory, researchers get the equilibriums of these three models. The result shows that, the pure model will incur a fixed portion of audience, if the platform wants to expand its customer, it needs the mixed model. Meanwhile, success of the mixed model depends on the add-on utility gained by VIP users compared with the free uses. The findings of this paper could contribute to development of video websites during the early and mid in their lifecycle.
- © 2015, the Authors. Published by Atlantis Press.
- Open Access
- This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).
Cite this article
TY - CONF AU - Zhihui Wu AU - Gang Liu PY - 2015/07 DA - 2015/07 TI - Choice of Business Model and Pricing Strategy with Ad-Sponsor and Subscription Fee BT - Proceedings of the International Conference on Logistics, Engineering, Management and Computer Science PB - Atlantis Press SP - 1536 EP - 1540 SN - 1951-6851 UR - https://doi.org/10.2991/lemcs-15.2015.306 DO - 10.2991/lemcs-15.2015.306 ID - Wu2015/07 ER -