Research On Platform Bundling Strategy And Antitrust Polic

It is common to observe the phenomenon that many manufacturers require customers to buy other products when selling some certain products or give a certain discount to the product set.This method of matching sales in a fixed proportion is called bundling.Bundling has not only anti-competitive effects,such as price discrimination,leverage effect,entry barrier effect,but also efficiency improvement effect,such as reducing information asymmetry,economies of scale and improving product quality.Therefore,it is difficult to determine the welfare effect of bundling.With the development of the platform economy,the business model of enterprises has undergone tremendous changes,and bundling has become more common and diverse.The February 2021 Antitrust Guidelines for the Platform Economy explicitly calls for concern about bundling,but also lists some reasonable exceptions.Both theory and practice show that the study of bundling strategy should start with the firm’s implementation motivation,and measure its possible anti-competition and welfare improvement effects comprehensively.Based on this background,combined with the new features of economic development of the platform,this article analyzes the oligopoly market competition environment,enterprise’s motive and the effect of bundle from the different pricing and bound objects,network externalities,and other related strategies of joint utility in order to provide reference for the implementation and improvement of the anti-monopoly review rules for bundling and related behavior strategies in China based on the existing research.The research works in this thesis are as follows: first,the literature on bundling and related behavioral strategies is systematically sorted out to determine the research gaps;secondly,starting from the research on enterprises and bundling strategies,this paper constructs the research basis with different pricing models,dynamic efficiency research,and two-sided market theory;finally,by comparing with the existing studies,the research value of this paper is highlighted,and the analysis of real cases is combined to provide suggestions for the selection of enterprise bundling and related behavioral strategies and the improvement of anti-monopoly policies.Specifically,the research content and innovation points of this paper mainly include the following aspects:First,this research analyzes the bundling motivation and welfare effect of platforms with different levels.As the basis of the research,this paper firstly studies the mechanism of oligopoly platform acquiring competitive advantage by bundling complementary merchant products on the platform under the wholesale price model.By constructing a three-stage dynamic game model,this paper analyzes the changes of merchants’ and platforms’ pricing strategies,overall industry profits,consumer surplus and social welfare under unilateral,bilateral and mixed bundling respectively.The results show that the platform can provide discounts for portfolio products through bundling,so as to promote more consumers to buy bundled products and gain competitive advantages.The two-sided hybrid bundling is the only Nash equilibrium,although the platform can be caught in a Prisoner’s dilemma.Bundling discounts on platforms have intensified competition in the market,forcing merchants on platforms to lower the wholesale prices of their products to mitigate the loss of demand caused by fierce competition.For consumers,bundling discounts create extra surplus and get utility boosts.Finally,bundling discounts distort consumers’ demand for products,resulting in excess demand for bundled products and insufficient demand for tie-in products,affecting the relationship between platforms and the relationship between platforms and merchants,and resulting in the loss of overall social welfare.Different from exsiting research,this paper concerned the bundling strategies of non owned products and certified the new motivation of the platform bundling as that the platform can merchants to bring down the wholesale price of its products by bundling sale to reduce the cost of sales of the platform.Compared with the mercants,the platform can be more motivated.However,the reduction of wholesale price is not transmitted to the price of final products.The platform increases the price of component products and bundling discounts to increase product differentiation and gain competitive advantages.Different from the relatively tolerant attitude towards mixed bundling in the past,this part of the research concludes that anti-monopoly agencies aiming at maximizing social welfare should prohibit the mixed bundling of merchants’ products by platforms under the wholesale mode.Second,corresponding to the wholesale mode,the agency mode is also a common method in platform sales.This paper analyzes the platform bundling motivation and the implementation of the most-favored-nation clauses incentive under the agency mode.This paper constructs a three-stage dynamic game and studies the incentive of platform influencing final product price through bundling discount and the effect of most-favored-nation clause.The results show that under the market structure of oligopoly competition,the platform must have the motivation to use the bundling strategy to interfere with the final product price,but it is not necessarily to use the mostfavored-nation clause to restrict the pricing of merchants,and the final impact on the total social welfare is uncertain.This part creatively compared the differences between the agency model and the wholesale price model in the bundling mechanism and found that the agency model alleviates the competition between platforms,and the pricing method of merchants reduces the distortion of demand,which is conducive to welfare improvement.Previous researches declared that most-favored-nation clauses restrict competition among platforms and lead to the increase of retail prices.This part of the research points out that when the platform can control the price of the final product through bundling discount,the most-favored-nation clause changes the influence mechanism of bundling discount on the price of the final product,and further intensifies the competition of the platform on bundling discount.Platforms have no incentive to adopt most-favored-nation clauses when the existing market is already competitive.Therefore,rather than most-favored-nation clauses,antitrust authorities should pay more attention to the platform’s bundling strategy.Next,cross-network externalities and multi-user ownership are important characteristics of bilateral platforms.On the basis of the research of platform bundling in the first two parts,this paper introduces the cross network externality and user multiownership into the analysis of platform bundling.Under the condition of non-negative price constraint,this paper studies the motivation of platform to break through nonnegative price constraint and implement subsidy to consumers through bundling.The results show that when the utility of monopolized products owned by the platform is small,the platform can not break through the non-negative price constraint by bundling subsidies to consumers.When the utility of the platform’s monopoly product is large,only when the cross-network externality brought by consumers to content providers is large enough,the platform will have the incentive to break through the non-negative price constraint through bundling.Bundling can cause another platform to exit the market as consumers increase cross-network externalities to content providers.Bilateral platform bundling is only a means for platforms to adjust pricing structure and consumer participation,so consumer surplus and total social welfare are always improved.Finally,in multi-periods game,entry blocking is one of the important reasons for incumbent enterprises to implement bundling strategy.This paper expands the multiperiods game,considering the mechanism of bilateral platform to maintain monopoly position by binding to exclude potential entrants.The results show that in the oneperiod game,the incumbent platform has no incentive to block efficient enterprises from entering through bundling.In multi-periods game,the incumbent platform will block the dynamic cooperation of potential entrants through bundling and reduce the risk of being replaced.Compared with previous studies,this part of the research introduces consumer heterogeneity and cross-network externalities of platforms,which expand the demand expansion effect of new enterprise entry and reduce the motivation of incumbent platforms to exclude potential entrants through bundling.However,the blocking of entry through bundling on bilateral platforms can result in greater welfare losses than in traditional markets.In conclusion,bundling motivation and welfare effects of competitive platforms are influenced by platform pricing model,cross-network externalities and user affiliation characteristics.The anti-monopoly department should pay more attention to the platform bundling in the market where the platform power is stronger and the dynamic efficiency is crucial to market access,and hold a relatively tolerant attitude to the bilateral platform bundling with multiple users.