Social Media and News: Content Bundling and News Quality

The growing influence of internet platforms acting as content aggregators is one the most important challenges facing media industry. We develop a simple model to understand impact third-party bundling by social platform that has monopoly on showing user-generated consumers. In our model, consumers can access news either directly through newspaper’s website or indirectly platform, which also offers content. show bundling, when unilaterally implemented tends harm publishers and increase dispersion quality across outlets, with initially high-quality outlets investing more low-quality ones less. With many heterogenous newspapers, result robust even if each newspaper prevent from using its When follows an agreement between publisher, effects are reversed, publishers’ profits go up while goes down. setup heterogeneous consumers, we platform’s ability personalize mix it shows users induces invest in their This paper was accepted Dmitri Kuksov, marketing. Funding: authors thank Net Institute for financial support. A. de Cornière acknowledges funding Agence Nationale la Recherche [Grant ANR-17-EUR-0010 (Investissements d'Avenir Program)], Toulouse School Economics Digital Center, Artificial Natural Intelligence Institute. Supplemental Material: online appendix available at https://doi.org/10.1287/mnsc.2022.4341 .