IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v9y2017i12p2247-d122095.html
   My bibliography  Save this article

Exploring Performance Determinants of China’s Cable Operators and OTT Service Providers in the Era of Digital Convergence—From the Perspective of an Industry Platform

Author

Listed:
  • Xing Wan

    (School of Business Administration, Nanjing University of Finance and Economics, Nanjing 210023, China)

  • Javier Cenamor

    (Entrepreneurship and Innovation, Luleå University of Technology, 97187 Luleå, Sweden
    School of Economics and Management, Lund University, S220 07 Lund, Sweden)

  • Jing Chen

    (School of Business Administration, Nanjing University of Finance and Economics, Nanjing 210023, China
    Rowe School of Business, Dalhousie University, Halifax, NS B3H 4R2, Canada)

Abstract

This paper investigates key determinants of business performance in China’s video industry in the era of digital convergence. Specifically, we analyze China’s OTT (over-the-top) service providers and cable operators based on the perspective of an industry platform, which acts as the core module of a business ecosystem and is capable of facilitating and coordinating interdependence among different agents. Panel data models are established to empirically explore what factors impact the performance of these two types of players. The findings demonstrate that both platform use and the size of an installed base are crucial for the determinants of the performance of OTT service providers and cable operators. An online video platform can also benefit from an increasing proportion of mobile viewers by implementing a multi-screen strategy. Further, an OTT service provider can profit from the interaction between its installed base and UGC (user-generated content), while cable operators can take advantage of positive feedback between their demand side and supply side.

Suggested Citation

  • Xing Wan & Javier Cenamor & Jing Chen, 2017. "Exploring Performance Determinants of China’s Cable Operators and OTT Service Providers in the Era of Digital Convergence—From the Perspective of an Industry Platform," Sustainability, MDPI, vol. 9(12), pages 1-19, December.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:12:p:2247-:d:122095
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/9/12/2247/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/9/12/2247/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kaiser, Ulrich & Wright, Julian, 2006. "Price structure in two-sided markets: Evidence from the magazine industry," International Journal of Industrial Organization, Elsevier, vol. 24(1), pages 1-28, January.
    2. Wu, Richard W.S. & Leung, Grace L.K., 2012. "Implementation of three network convergence in China: A new institutional analysis," Telecommunications Policy, Elsevier, vol. 36(10), pages 955-965.
    3. Richard A. D'Aveni & Giovanni Battista Dagnino & Ken G. Smith, 2010. "The age of temporary advantage," Strategic Management Journal, Wiley Blackwell, vol. 31(13), pages 1371-1385, December.
    4. Jean-Charles Rochet & Jean Tirole, 2002. "Cooperation Among Competitors: Some Economics Of Payment Card Associations," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 549-570, Winter.
    5. Youngjin Yoo & Richard J. Boland & Kalle Lyytinen & Ann Majchrzak, 2012. "Organizing for Innovation in the Digitized World," Organization Science, INFORMS, vol. 23(5), pages 1398-1408, October.
    6. Lin, Trisha T.C., 2013. "Convergence and regulation of multi-screen television: The Singapore experience," Telecommunications Policy, Elsevier, vol. 37(8), pages 673-685.
    7. Amrit Tiwana & Benn Konsynski & Ashley A. Bush, 2010. "Research Commentary ---Platform Evolution: Coevolution of Platform Architecture, Governance, and Environmental Dynamics," Information Systems Research, INFORMS, vol. 21(4), pages 675-687, December.
    8. Marc Rysman, 2009. "The Economics of Two-Sided Markets," Journal of Economic Perspectives, American Economic Association, vol. 23(3), pages 125-143, Summer.
    9. den Hartigh, Erik & Ortt, J. Roland & van de Kaa, Geerten & Stolwijk, Claire C.M., 2016. "Platform control during battles for market dominance: The case of Apple versus IBM in the early personal computer industry," Technovation, Elsevier, vol. 48, pages 4-12.
    10. John W. Mayo & Yasuji Otsuka, 1991. "Demand, Pricing, and Regulation: Evidence from the Cable TV Industry," RAND Journal of Economics, The RAND Corporation, vol. 22(3), pages 396-410, Autumn.
    11. Bryan Pon & Timo Seppälä & Martin Kenney, 2015. "One Ring to Unite Them All: Convergence, the Smartphone, and the Cloud," Journal of Industry, Competition and Trade, Springer, vol. 15(1), pages 21-33, March.
    12. Tasneem Chipty, 2001. "Vertical Integration, Market Foreclosure, and Consumer Welfare in the Cable Television Industry," American Economic Review, American Economic Association, vol. 91(3), pages 428-453, June.
    13. Linda S. L. Lai & Efraim Turban, 2008. "Groups Formation and Operations in the Web 2.0 Environment and Social Networks," Group Decision and Negotiation, Springer, vol. 17(5), pages 387-402, September.
    14. Beck, Nathaniel & Katz, Jonathan N., 1995. "What To Do (and Not to Do) with Time-Series Cross-Section Data," American Political Science Review, Cambridge University Press, vol. 89(3), pages 634-647, September.
    15. Zhang, Jing & Liang, Xiong-Jian, 2011. "Business ecosystem strategies of mobile network operators in the 3G era: The case of China Mobile," Telecommunications Policy, Elsevier, vol. 35(2), pages 156-171, March.
    16. Otsuka, Yasuji, 1997. "A Welfare Analysis of Local Franchise and Other Types of Regulation: Evidence from the Cable TV Industry," Journal of Regulatory Economics, Springer, vol. 11(2), pages 157-180, March.
    17. Peitz, Martin & Valletti, Tommaso M., 2008. "Content and advertising in the media: Pay-tv versus free-to-air," International Journal of Industrial Organization, Elsevier, vol. 26(4), pages 949-965, July.
    18. Lars Bo Jeppesen & Lars Frederiksen, 2006. "Why Do Users Contribute to Firm-Hosted User Communities? The Case of Computer-Controlled Music Instruments," Organization Science, INFORMS, vol. 17(1), pages 45-63, February.
    19. Mangold, W. Glynn & Faulds, David J., 2009. "Social media: The new hybrid element of the promotion mix," Business Horizons, Elsevier, vol. 52(4), pages 357-365, July.
    20. Christophe Van den Bulte & Stefan Stremersch, 2004. "Social Contagion and Income Heterogeneity in New Product Diffusion: A Meta-Analytic Test," Marketing Science, INFORMS, vol. 23(4), pages 530-544, July.
    21. Xing Wan & Javier Cenamor & Geoffrey Parker & Marshall Van Alstyne, 2017. "Unraveling Platform Strategies: A Review from an Organizational Ambidexterity Perspective," Sustainability, MDPI, vol. 9(5), pages 1-18, May.
    22. Funk, Jeffrey L., 0. "The emerging value network in the mobile phone industry: The case of Japan and its implications for the rest of the world," Telecommunications Policy, Elsevier, vol. 33(1-2), pages 4-18, February.
    23. Hemant K. Bhargava & Vidyanand Choudhary, 2004. "Economics of an Information Intermediary with Aggregation Benefits," Information Systems Research, INFORMS, vol. 15(1), pages 22-36, March.
    24. Mark Armstrong Author-Email: mark.armstrong@ucl.ac.uk Author-Workplace-Name: University College of London, 2006. "Competition in Two-Sided Markets," RAND Journal of Economics, The RAND Corporation, vol. 37(3), pages 668-691, Autumn.
    25. Wu, Irene, 2004. "Canada, South Korea, Netherlands and Sweden: regulatory implications of the convergence of telecommunications, broadcasting and Internet services," Telecommunications Policy, Elsevier, vol. 28(1), pages 79-96, February.
    26. Shu-Chu Sarrina Li, 2004. "Market Competition and the Media Performance of Taiwan's Cable Television Industry," Journal of Media Economics, Taylor & Francis Journals, vol. 17(4), pages 279-294.
    27. Suarez, Fernando F., 2004. "Battles for technological dominance: an integrative framework," Research Policy, Elsevier, vol. 33(2), pages 271-286, March.
    28. van den Bulte, C. & Stremersch, S., 2003. "Contagion and heterogeneity in new product diffusion: An emperical test," ERIM Report Series Research in Management ERS-2003-077-MKT, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    29. Jungwoo Shin & Yuri Park & Daeho Lee, 2015. "Google TV or Apple TV?—The Reasons for Smart TV Failure and a User-Centered Strategy for the Success of Smart TV," Sustainability, MDPI, vol. 7(12), pages 1-12, December.
    30. Roson Roberto, 2005. "Two-Sided Markets: A Tentative Survey," Review of Network Economics, De Gruyter, vol. 4(2), pages 1-19, June.
    31. Ron Adner & Rahul Kapoor, 2010. "Value creation in innovation ecosystems: how the structure of technological interdependence affects firm performance in new technology generations," Strategic Management Journal, Wiley Blackwell, vol. 31(3), pages 306-333, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xing Wan & Javier Cenamor & Geoffrey Parker & Marshall Van Alstyne, 2017. "Unraveling Platform Strategies: A Review from an Organizational Ambidexterity Perspective," Sustainability, MDPI, vol. 9(5), pages 1-18, May.
    2. Cenamor, Javier & Frishammar, Johan, 2021. "Openness in platform ecosystems: Innovation strategies for complementary products," Research Policy, Elsevier, vol. 50(1).
    3. Dewenter, Ralf & Haucap, Justus & Wenzel, Tobias, 2011. "Semi-collusion in media markets," International Review of Law and Economics, Elsevier, vol. 31(2), pages 92-98, June.
    4. Ke Rong & Yong Lin & Boyi Li & Thommie Burström & Lynne Butel & Jiang Yu, 2018. "Business ecosystem research agenda: more dynamic, more embedded, and more internationalized," Asian Business & Management, Palgrave Macmillan, vol. 17(3), pages 167-182, July.
    5. Gawer, Annabelle, 2014. "Bridging differing perspectives on technological platforms: Toward an integrative framework," Research Policy, Elsevier, vol. 43(7), pages 1239-1249.
    6. Charles Angelucci & Julia Cagé, 2019. "Newspapers in Times of Low Advertising Revenues," American Economic Journal: Microeconomics, American Economic Association, vol. 11(3), pages 319-364, August.
    7. Jullien, Bruno & Pavan, Alessandro & Rysman, Marc, 2021. "Two-sided Markets, Pricing, and Network Effects," TSE Working Papers 21-1238, Toulouse School of Economics (TSE).
    8. Jabbour, Chady & Rey-Valette, Hélène & Maurel, Pierre & Salles, Jean-Michel, 2019. "Spatial data infrastructure management: A two-sided market approach for strategic reflections," International Journal of Information Management, Elsevier, vol. 45(C), pages 69-82.
    9. Huixin Liu & Fang Liu & Feng Du, 2022. "Research on Platform Operation Strategy Considering Consumers’ Hassle Costs," Sustainability, MDPI, vol. 14(5), pages 1-17, February.
    10. Oliver Budzinski & Janina Satzer, 2011. "Sports Business and Multisided Markets: Towards a New Analytical Framework? (Long Version)," Working Papers 1104, International Association of Sports Economists;North American Association of Sports Economists.
    11. Oliver Budzinski & Janina Satzer, 2008. "Sports Business and the Theory of Multisided Markets," MAGKS Papers on Economics 200811, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    12. Thorsten Koch & Josef Windsperger, 2017. "Seeing through the network: Competitive advantage in the digital economy," Journal of Organization Design, Springer;Organizational Design Community, vol. 6(1), pages 1-30, December.
    13. repec:spo:wpmain:info:hdl:2441/4edekc99or8n2bu86nu4ua8adl is not listed on IDEAS
    14. repec:hal:spmain:info:hdl:2441/4edekc99or8n2bu86nu4ua8adl is not listed on IDEAS
    15. de Reuver, Mark & Ondrus, Jan, 2017. "When technological superiority is not enough: The struggle to impose the SIM card as the NFC Secure Element for mobile payment platforms," Telecommunications Policy, Elsevier, vol. 41(4), pages 253-262.
    16. Reisinger, Markus, 2014. "Two-part tariff competition between two-sided platforms," European Economic Review, Elsevier, vol. 68(C), pages 168-180.
    17. Reisinger, Markus, 2010. "Unique Equilibrium in Two-Part Tariff Competition between Two-Sided Platforms," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 308, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    18. Jan Frederic Nerbel & Markus Kreutzer, 2023. "Digital platform ecosystems in flux: From proprietary digital platforms to wide-spanning ecosystems," Electronic Markets, Springer;IIM University of St. Gallen, vol. 33(1), pages 1-20, December.
    19. Jacobides, Michael G. & Cennamo, Carmelo & Gawer, Annabelle, 2024. "Externalities and complementarities in platforms and ecosystems: From structural solutions to endogenous failures," Research Policy, Elsevier, vol. 53(1).
    20. Sören Wallbach & Katrin Coleman & Ralf Elbert & Alexander Benlian, 2019. "Multi-sided platform diffusion in competitive B2B networks: inhibiting factors and their impact on network effects," Electronic Markets, Springer;IIM University of St. Gallen, vol. 29(4), pages 693-710, December.
    21. Renato Gomes & Alessandro Pavan, 2013. "Cross-Subsidization and Matching Design," Discussion Papers 1559, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    22. Stühmeier, Torben & Wenzel, Tobias, 2011. "Getting beer during commercials: Adverse effects of ad-avoidance," Information Economics and Policy, Elsevier, vol. 23(1), pages 98-106, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:9:y:2017:i:12:p:2247-:d:122095. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.