1. Task 1
Understand the
structure and
ownership of the
media sector. P1,
M1, D1
EXPLAINING THE
STRUCTURE AND
OWNERSHIP OF THE
MEDIA SECTOR

2. A privately held company or close corporation is a business company owned
either by non-governmental organizations or by a relatively small number of
shareholders or company members which does not offer or trade its
company stock.
An example of a private company will be a company called IKEA. IKEA sell
household furniture's and other house necessities . Not only do they sell
household necessities they also sell food and they have their own
restaurants in the shops. IKEA has 332 stores in 38 countries. In fiscal year
2010, it sold $23.1 billion worth of goods. All of the goods that was sold by
IKEA was kept to the owners. This is an advantage of a private ownership,
all of the money you earn you get to keep. The disadvantage of this is that if
IKEA start losing sales the people that would lose money are the owners
only no one else.
TYPES OF OWNERSHIP: PRIVATE OWNERSHIP

3. An example of a public service ownership will be BBC. The BBC their main
job is to educate, entertain and inform the whole public of the United
Kingdom. The public all have a say what goes in the BBC because each and
every single household in the UK pay a TV license fee that goes towards the
BBC licensing fee. As a public we all have a say what the BBC shows. As a
public we all have a vote of what shows we want and what shows we don’t
want. The advantage of public service is that if the BBC produce a show that
doesn’t do well the BBC don’t lose any money because they get their money
through the public through the licensing fee.
TYPES OF OWNERSHIP: PUBLIC SERVICE

4. Multinational is where a company is owned by more than one country. Its
usually a large company which sells goods in many country’s. It can also be
referred to as a international corporation. An example of this will be Canon.
Canon is a Japanese multinational corporation specialized in the
manufacture of imaging and optical products, including cameras,
camcorders, photocopiers, steppers, computer printers and medical
equipment. The advantage of a multinational ownership is that with your
company being multinational is that you will gain a lot more profit due to the
fact that your company is multinational. The disadvantage of this is that if
your business across the countries don’t do well financially then the owners
lose money.
TYPES OF OWNERSHIP: MULTINATIONAL

5. An independent company is sometimes referred to as ‘indie’. This is where a
company is independently owned which is very common among new and up
coming bands. An example of this will be an independent record label called
blast. It caters of alternative music style bands who have a specific
audience. A major disadvantage with being a independent label is that not
many people know who you are and it will be hard make money which you
need to order to promote your band to the public.
TYPES OF OWNERSHIP: INDEPENDENT

6. Conglomerate is a combination of corporations that fall into one big
company. An example of this will be Wal-Mart. Wal-Mart own a lot of
companies world wide. Like Asda, Sam’s Club, Seiyu Group and Walmex.
The advantage of a conglomerate ownership is that you will gain a lot more
money. Wal-Mart for example will make money off their
subsidiarycompanies such as Asda, Sam’s Club and so on. The
disadvantage of a conglomerate ownership is that if for example Asda start
losing sales then Wal-Mart would lose profit because they are responsible
for the subsidiary companies.
TYPES OF OWNERSHIP: CONGLOMERATE

7. Horizontal integration is a lot of companies in one. They share profit. An example
of this will be Windows (Microsoft). Windows make the software and the
hardware is made up of different products such as NVidia, AMD, SATA, RealTek
and RAM. Windows will buy certain hardware from different companies giving
individual companies profit. So windows don’t get the full profit for their
products.
-An advantage is that you will not struggle in producing certain hardware or
software
-An advantage is that it makes the product more diverse because more people
are involved
-A disadvantage there will be trust issues within companies
-A disadvantage is that if one company fails then the rest are more likely to fail
TYPES OF COMPANIES:
HORIZONTAL INTEGRATION

8. Vertical integration is where everything is done under one roof, an independent company
if you will. An example of this will be apple. Apple make their own hardware and software
and they do not share it with other companies. The reason for this is so that they make
more profit with all the products that they sell. Even if you have a Windows computer if
you have an iPhone, iPod’s Mac’s etc. If you want to download music in to your apple
products you will need iTunes on your Windows computer.
-Advantage of Apple is that they gain all the profit that they make
-Another advantage is that they gain more control with everything and no communication
is lost
-A disadvantage of vertical integration is that if one of apple’s product break apple have
to fix it and pay for the damage
-Another disadvantage is that if you’re a small company you will need someone to fund
you due to the fact that you’ll need a warehouse to get started. You will also lose skill
because you need people to specialize in a certain area.
TYPES OF COMPANIES:
VERTICAL INTEGRATION

9. Synergy means when two different things such as two different companies
come together to make something. An example of Synergy will be Disney.
Disney is a type of synergy due to the fact that Disney have areas of work in
all kinds of media related subjects. When Disney produce films for the
children they go and watch that film in the cinemas. After that they are more
likely to watch the Disney channel due to the fact that they might see
characters that they love on the Disney Channel. The companies that will
gain profit here will be the cinema companies and the media companies
such as Virgin, Sky and BT and so on.
SYNERGY

10. Our technology nowadays are very advanced when it comes to cross media.
Years ago if you wanted to read the newspaper you will have to buy and
newspaper and but nowadays you can access the news on your
smartphones. Not only can you access news you can access photos, videos,
music, maps and so on. All of these things you’ll be able to do on your
smartphone. Through the years our technology in terms of cross media have
really developed and progressed over the years. Even now they carry on
progressing as our technology becomes more advanced.
CROSS MEDIA DIVERGENCE