Newspaper Price Wars

By Daniel Sexton

Why Do Price Wars Occur?

Source: edEcon, June 2011

Four Firm Concentration Ratio = 85.3%

Why Do Price Wars Occur?

• News International Newspapers Ltd – 36.3%• Associated Newspapers – 21.7%• Trinity Mirror Plc – 13.8%• Express Newspapers Ltd – 13.5%• Telegraph Group Ltd – 8.4%• Guardian Newspapers Ltd – 3.1%• Independent Newspapers Ltd – 1.9%• Financial Times Ltd – 1.4%

How Do Price Wars Occur?

Price Market Share

£6 Million Each Y - £3.5 MillionX - £7 Million

Y - £7 MillionX - £3.5 Million £5 Million Each£0.80

£0.80

£1.00

£1.00Firm X’s Price

Firm Y’s Price

And if that doesn’t work…..Free Stuff!!!

Discounts!!!

Extras: Online/Apps!!!

Exclusive News & Stories!!!

Market Share

Collusion?

?

How Often Do Price Wars Occur?

Brand Loyalty!

Any Questions?