ConglomerateConglomerates/Media s/Media MergersMergers

• Basic understanding of conglomerates• Media Conglomerates worldwide

• Example from Pakistan

Conglomerates?Conglomerates?• Conglomerate is a corporation that is made up of

a number of different, seemingly unrelated businesses. In a conglomerate, one company owns a controlling stake in a number of smaller companies, which conduct business separately

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Why Conglomerates Why Conglomerates merge:merge:

• There can be many reasons for firms to want to merge, the very basic interests include increasing market share, synergy and cross selling. Firms also merge to diversify and reduce their risk exposure. However, if a conglomerate becomes too large as a result of acquisitions, the performance of the entire firm can suffer.

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Media Conglomerates or Media Conglomerates or concentration of concentration of

ownership:ownership:• Some nations can influence and control their media greatly. • In addition, powerful corporations also have enormous

influence on mainstream media. • In some places major multinational corporations own media

stations and outlets. • Often, many media institutions survive on advertising fees,

which can lead to the media outlet being influenced by various corporate interests.

• Other times, the ownership interests may affect what is and is not covered. Stories can end up being biased or omitted so as not to offend advertisers or owners.

• The ability for citizens to make informed decisions is crucial for a free and functioning democracy but now becomes threatened by such concentration in ownership.

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8 Giant Media 8 Giant Media ConglomeratesConglomerates

• There have been a lot of mergers and buyouts of media and entertainment companies since the 1980s. Mainstream media has since become more concentrated in terms of ownership and the influences of advertisers and owning companies both have an enormous in how mainstream media shapes itself and society

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8 Giant Media 8 Giant Media ConglomeratesConglomerates

• Disney• AOL- Times

Warner• Viacom• General

Electric• News

Corporation

• Yahoo!• Microsoft• Google

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Disney Disney

(Market Value: (Market Value:

$72.8 Billion) $72.8 Billion) • The Walt

Disney Company is the largest global media conglomerate. Its FY 2000 revenues topped $25 billion, with 27% derived from parks and resorts, 24% from studio entertainment, and 17% from media networks.

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Example from Example from PakistanPakistan

• The Independent Media Corporation. • It started with the publication of the Jang Group

of Newspapers and later added the Geo Network to its offerings. The corporation holds monopoly in the print and electronic media market with its revenues higher as compared to the combined revenues of other media groups in Pakistan.

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Independent Media Independent Media CorporationCorporation

• It started with the publication of the Jang Group of Newspapers and later added the Geo Network to its offerings.

• The corporation holds monopoly in the print and electronic media market with its revenues higher as compared to the combined revenues of other media groups in Pakistan.

• Mir Khalil ur Rehman was the founder of the group and his son, Mir Shakil ur-Rahman, is the present head of the

business house based in Karachi. • IMC owns the Jang Group of Newspapers and the Geo TV network.

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Independent Media Independent Media CorporationCorporation

o Geo News - a Pakistan based Urdu news channelo AAG TV - launched in September 2006 by the Geo Network, focusing

on programs for the youth in Pakistan. Its broadcast was suspended in 2013

o GEO Super - sports channel, launched by Geo Network in September 2006. Programming content includes variety of sports from around the world, focusing mainly on cricket, with a secondary focus on boxing, football, tennis and field hockey.

o Geo TV - a Pakistan based entertainment channel showing Dramas, musical programs, feature movies, primarily in the Urdu Language.

o Geo Tez - a Pakistan based Headline channelo Geo Kahani - a Pakistan based Explicit Drama Channel

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Negative impact of Conglomeration:

• profit becomes the main focus of corporate effort. Ivan Fecan, CEO of CTV, says: “If we can’t make money, we have no reason to exist.”

• Conglomeration of media also leads to reduced quality of programs because they shift the interest of audiences to less important news such as celebrity scandals.

• When celebrity Anna Nicole Smith died in 2007, cable news net-works gave more coverage to her death than any other important news such as war in Iraq (Baran 38).

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• Saad ul Azeem (Individual Presenter)• 15-10189• MCOM 310• Presentation Topic: Conglomerates• Presented to: Ma’am Amber Mubeen• Date: 1st July, 2014• Summer 2014

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