Ad-free subscription service introduction for competing digital content platforms
研究两个竞争的数字内容平台是否应引入无广告订阅服务，发现均衡策略取决于消费者对内容的渴望程度和H型消费者的广告厌恶程度，并分析了该服务对广告商和内容创作者的影响。
This study develops a game-theoretical model involving two competing digital content platforms, each connecting content creators, advertisers and consumers, to examine whether a platform should introduce an ad-free subscription (AFS) service. Considering two types of consumers, ad-insensitive (L-type) and ad-sensitive (H-type), we analyse four strategy combinations: neither platform introduces AFS (i.e., NN), only one platform introduces AFS (i.e., IN/NI), and both platforms introduce AFS (i.e., II). We find that the equilibrium strategies of the platforms depend on consumers’ desire for content and the degree of ad aversion among H-type consumers. When the desire for content is low or H-type consumers exhibit weak ad aversion, neither platform introduces the AFS service, resulting in the NN equilibrium. In this situation, a prisoner’s dilemma emerges. When the two factors are moderate, only one platform introduces the AFS service, leading to an asymmetric equilibrium. In contrast, when both factors are high, both platforms adopt the AFS service, yielding the II equilibrium. For advertisers, AFS service introduction by one platform is beneficial when the desire for content is moderate and ad aversion among H-type consumers is strong. For content creators, however, the AFS service adoption consistently leads to lower compensation within our model framework which focuses on direct content rewards.