Content Exclusivity on Advertising Revenue–Sharing Platforms

Digital content platforms rely on third-party providers to attract consumers. These platforms monetize content through advertising and share ad revenues with providers to incentivize content contribution. As providers increasingly multihome across platforms, competition intensifies; some platforms respond with exclusive contracts to restrict content providers’ multihoming behavior. This paper develops an analytical model of two ad-supported content platforms and shows that exclusivity operates through a direct effect (fewer providers per platform, alleviating same-side crowding) and a strategic effect (revenue sharing becomes a less effective lever for poaching providers). We find that exclusive contracts make platforms worse off when consumers’ marginal valuation for content is high and, thus, do not mandate exclusivity in that parameter region; when consumers’ marginal valuation is low, platforms prefer exclusivity. The total provider surplus can rise under exclusivity, and at intermediate marginal valuations, exclusivity can lead to a win–win outcome for both platforms and providers. These findings suggest that policymakers should exercise caution when considering restrictions on content exclusivity because such policies may unintentionally reduce platform profits, provider surplus, and social welfare.

History: Param Singh, Senior Editor; Zhengrui Jiang, Associate Editor.

Funding: For this research, Y. Wei, L. Tian, and H. Wei are partially supported by the National Natural Science Foundation of China [Grants 72102241, 72325013, and 72571162].

Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2025.1852.