Does advertising revenue increase or diminish content differentiation in media markets? This paper shows that an increase in the technically feasible number of ad breaks per video leads to an increase in content differentiation between several thousand YouTube channels. I exploit two...

This paper studies the effect of advertising on content differentiation on YouTube, the second-most visited website in the world. I demonstrate that an exogenous increase in the feasible advertising quantity leads to a considerable decrease in the YouTubers' probability to duplicate mainstream...