King Rat (gkr) wrote,
King Rat

Eco 200: newspaper a monopoly?

(group) Does a firm have a monopoly if it publishes the only morning newspaper in a particular city? If it publishes the only daily newspaper, morning or afternoon? If it publishes the only daily newspaper and owns the only television channel in the city? What are the various goods that a daily newspaper supplies? With what other goods do they compete?

According to Heyne, no true monopolies exist. A newspaper supplies news & content to subscribers, and advertising space and access to subscribers to advertisers. Some newspaper companies supply other goods such as sports teams, but content and advertising are the two supplied by all newspapers.

Television, magazines, radio, movies, and others supply goods that compete with both types of goods.

DVD suppliers, city parks, and nightclubs also are suitable substitutes for much of the content supplied by newspapers. Most newspaper consumers are filling recreational time. If the price of the newspaper climbs high enough, buyers will fill their entertainment desires elsewhere. Some specialized content cannot be substituted by generic entertainment. For instance, some readers strongly desire local government meeting agendas or public bid notices. Particular content may have fewer substitutes.

The U.S. Postal Service with delivery of direct mail, outbound call centers, and signboard carriers compete in selling advertising space to locals.


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