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NTU Management Review Vol. 33 No. 2 Aug. 2023

5.2 The Independent-MCN Structure (I) versus the Leagued-MCN One (L)
creators’ effort exertion decisions. Here we introduce one additional mild assumption
To see how the ownership of MCN affects the industry, we further compare the
to avoid tedious derivations. Similar to the original condition
independent-MCN structure (I) and the leagued-MCN structure (L) regarding the creators’
� �
� �
effort exertion decisions. Here we introduce one additional mild assumption β β A < k to
H is
2 (cf. Assumption 1) we impose for structure I, the new condition
L
� �
avoid tedious derivations. Similar to the original condition β β A < 2k (cf. Assumption
H
L
made so that the MCN under structure L does not find it optimal to induce the creators
1) we impose for structure I, the new condition β β A < k is made so that the MCN
H
L
under structure L does not find it optimal to induce the creators to exert an infinitely large
to exert an infinitely large amount of effort level.
amount of effort level.
Proposition 4. There exists a threshold >0 such that when and
Proposition 4: There exists a threshold γ > 0 such that when γ < γ and
�
�
0
0
� � � � � � � � � � � �
�� ����� � ��� � � �� ����� � ��� � �
� � � � � � � � � �
, we have > .
� � � �

It is demonstrated that when the per-view payment γ provided by the sharing platform
is low enough, the effort level of the low-type creator under structure I may be larger than
It is demonstrated that when the per-view payment provided by the sharing
the one under structure L. It is because under structure I, the independent MCN usually
platform is low enough, the effort level of the low-type creator under structure I may
5
takes away a larger proportion of the revenue from the low-type creator, which sometimes
drives it to allocate partial advertorial to the low-type creator. This decision further
be larger than the one under structure L. It is because under structure I, the independent
motivates the low-type creator to increase his effort level. As for structure L, in order
MCN usually takes away a larger proportion of the revenue from the low-type creator ,
to maximize the total profit, the creator with a higher ability would take charge of more 6
tasks since she is more likely to achieve the threshold. When γ is small, which means that
which sometimes drives it to allocate partial advertorial to the low-type creator. This
the creators’ effort exertion decisions depend mostly on the revenue from the advertorial,
decision further motivates the low-type creator to increase his effort level. As for
the impact of the advertorial allocation decision on the low-type creator’s effort exertion
decision becomes more significant, making the effort of low-type creator under structure I
structure L, in order to maximize the total profit, the creator with a higher ability would
possible to be larger than the one under structure L.
take charge of more tasks since she is more likely to achieve the threshold. When is
This phenomenon indicates that the existence of the independent MCN company
provides certain benefits for the low-type creator. As a result, the low-type creator may
small, which means that the creators’ effort exertion decisions depend mostly on the
prefer the independent-MCN industry structure rather than the leagued-MCN structure.
revenue from the advertorial, the impact of the advertorial allocation decision on the
Since the construction of the leagued-MCN structure requires the agreement between
low-type creator’s effort exertion decision becomes more significant, making the effort
both the high- and low-type creators, and the low-type creator tends to prefer structure I,
structure L is hard to be realized in reality. This also provides illuminating justification
of low-type creator under structure I possible to be larger than the one under structure
L.
5 From Proposition 2, we know that when a creator’s ability β i is improved, the revenue sharing
I
percentage left for her/him will also increase. Therefore, the lower the creator’s ability is, the
ϕ i
higher the proportion of revenue MCN can take away.

6 From Proposition 2, we know that when a creator’s ability � is improved, the revenue sharing
17
percentage left for her/him will also increase. Therefore, the lower the creator’s ability is, the
�
�
higher the proportion of revenue MCN can take away.
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