Media Company Case StudyTask 1 Understand the structure

and ownership of the media sector your name here

Types of ownership: private ownership

Private ownership refers to a company that is owned and operated by on one or more individuals and not by the government, with airing advertisements being their source of income.

An example of private ownership is the British television network channel 5, which is owned by Northern & Shell and relies on airing advertisements in order to generate their income. The main advantage of this particular type of ownership is that it involves minimal government influences and therefore gives the media freedom, giving the owners the ability to run the company how they want to. Also due to the fact that there is the threat of losing market share to a number of competitors, it encourages the companies to put forth their best product and therefore can result in better quality products, in which case audience measurements will increase therefore the broadcaster will be able to charge more for airing advertisements and as a result will increase the profit made.

However this type of ownership does have its disadvantages such as it relying on airing advertisements to function, their must be advertisers willing to advertise on their particular channel, radio show etc, without this there will be no funding to produce new shows and so on. Also privately owned channels are able to fund shows without the input of the public, unlike publicly owned which spend a lot of time researching what the audience wants and needs to see before funding a show, therefore there is a higher chance that privately owned broadcasters will create a show that is un successful

Types of ownership: public service

Public service ownership refers to radio, television and a variety of other media outlets who’s primary mission is public service. The BBC (British Broadcasting Corporation) is a publicly owned broadcaster, owned by the UK government. Unlike privately owned broadcasters which rely on airing advertisements to generate funding, public service broadcasters such as the BBC are funding by the annual television license fee which is charged to all British households or companies using any type of equipment to record or receive live television broadcast and therefore the BBC airs no advertisements.

The advantage of public service broadcasters is that they will feature a wide variety of shows, due to the fact that it is owned by the public and has to cater for all the publics wants and needs.

Types of ownership: independent

Independent Ownership refers to a company which is independently funded. A prime example of Independent ownership is ‘Neon Gold Records’, a New York/London based independent record label. Independently owned companies are usually made up of a few people, due to the fact that because of the internet providing a platform musicians, radio producers, film makers and game developers to showcase their work to millions, there is little need to get involved with larger companies.

The main advantages of independent ownership is that these companies have a lot more to say about how the company is run and complete control over what they decide to produce, unlike companies with different types of ownership.

The disadvantage is that due to the small budget available within independently owned companies, the outcome tends to be much less ambitious and often have to secure extra funding and finance in order to keep the company functioning.

Types of ownership: conglomerate

A media conglomerate refers to a company that owns large numbers of companies across various mass media such as radio, television, publishing, films etc. A prime example of media conglomerate being Walt Disney.

Walt Disney is Americas largest conglomerate in terms of revenue. Walt Disney owns various companies across a variety of mass media including:Walt Disney Studios: includes the companies film, recording label and theatrical division.

Parks and Resorts: Includes theme parks and cruise lines

Disney’s Consumer Products: produces toys, clothes and other merchandise

Media Networks: Includes television properties

Disney Interactive: Includes Disney internet, social media, virtual worlds and games.

Types of Companies:Horizontal Integration

Horizontal Integration is when a company buys competitors in the same section of the industry. A prime example of horizontal integration is when Universal conglomerate bought EMI and as a result EMI became a subsidiary of Universal.

There are a number of advantages of horizontal integration. One of these being that horizontal integration result in a larger company and therefore produces more products or services. Also due to this it also results in a saving in costs. One of the main advantages is that horizontal integration results in an access to new markets, due to the fat that not only will the company have their existing markets, they will have access to the markets of the companies they bought.

However there are disadvantages such as the fact that it can result in the business getting too big too fast, therefore causing problems with management of resources and as a result causing problems with communication and co-ordination because the newly bought buisness tries to fall in line with the existing company.

Types of Companies: Vertical Integration

Vertical integration is when a company owns and profits from all stages, including the production, distribution and consumption. In previous years it was only large companies such as Sony that were able to afford to produce, distribute and profit from consumption, however due to modern technology such as the internet, much smaller companies such as independent record labels.A prime example of a vertically integrated company is apple because they produce everything including the hardware and software to go with it and therefore receive all the profit.

The main advantage of vertical integration is that because they are not paying any one else to produce anything for them, they therefore as a company receive all the profit. However the main disadvantage is that vertical integration is only effective if it is a large company with a large skillset. Also it costs a lot of money to set up a vertically integrated company.

Cross Media Convergence

Cross media convergence is when a range of media is integration within a single piece of technology product. A prime example of this is the I Phone which can play music, phone calls, check emails and so on. An advantage of this is that one product allows you access a number of things and is a lot more financially viable than buying more than one product.

Cross media convergence is common across various media sctors, for example both the gaming industry, film industry and TV industry tend to use popular music throughout their productions, therefore promoting the song and benefiting the artist. A prime example of this is the TV show which involves contestants singing exiting songs, therefore promoting the original artist.

Synergy

Synergy is when a variety of companies work together in a way that is mutually benifitial. A prime example of this is the X-factor which is run by Sony, Simon Cowell and ITV. The advantage of this is that all three companies benefit from working together, due to the fact that Simon Cowell owns the programme X-factor which is shown on ITV therefore when millions of people watch the show, both Simon Cowell and ITV benefit, then when people vote for their favourite music acts, not only does Simon Cowell and ITV benefit, so does the record label Sony.

Describe the Structure and of Ownership of Either The Film, TV, Gaming or Music IndustryWithin the music industry there are the 3 major record labels, Sony Music Entertainment, Universal Music Group and Warner Music Group. There are also both horizontally and vertically integrated companies within the music industry, Universal Music Group bought EMI, therefore becoming a horizontally integrated, meaning that the previous major label EMI became a subsiary of Universal. A prime example of a vertically integrated company within the music industry is Sony which takes care of and profits from the production, distribution and consumption. Independent records such as ‘Neon Gold Records’ are much smaller than the major 3 and often don’t have the funding's to be vertically integrated. However due to modern technology it is so much easier than previous years for independent labels to produce their own music by recording music on computers and distribute these singles by burning CD’s at home, also due to Web 0.2 it is very easy for these companies to promote their label and music on social networking sites such as Facebook.

Disney

Walt Disney is Americas largest horizontally integrated conglomerate in terms of revenue. Walt Disney owns various companies across a variety of mass media including:Walt Disney Studios: includes the companies film, recording label and theatrical division.

Parks and Resorts: Includes theme parks and cruise lines

Disney’s Consumer Products: produces toys, clothes and other merchandise

Media Networks: Includes television properties

Disney Interactive: Includes Disney internet, social media, virtual worlds and games

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A well as owning shares in a variety of other companies including Pixar

Ownership & Competitors

Disney was founded in 1923 by Walt Disney and Roy O Disney, from 1923 until 1945 Mr Walt Disney acted as president, since then a number of men have acted as president. For the last 14 years Robert Iger has acted as president.

Disney's main competitors are NBC Universal media, DreamWorks, Twenty First Century Fox, all of which re conglomerate companies owning over 65% of the TV market.

Audience

Disneys primary target audience is In the United States fiscal 2010 marked Disney Channel’s most watched year on record in total day and total viewers, as well among the key audiences of kids aged 6-11 and tweens aged 9-14. Disney Channel also celebrated its eighth consecutive year as television’s No. 1 network in primetime among kids aged 6-11 and its 10th year at No. 1 with tweens aged 9-14, thanks to a strong slate of original programming.