1. Warner Bros
Warner bros is one of the major leading film studios (this makes it an oligopoly), that was
independent from 1918- 1967, but as of 1967 became subsidiary to Warner Bros.-Seven Arts for
3 years. After that Kinney National Company became their new parent company for the following
2 years. Then after that Warner Communications became their new parent company from 19721990. Warner bros then came subsidiary to time Warner from 1990-2001 and then AOL Time
Warner took over from 2001-2003, from there Time Warner became its parent company again
and remained to be their parent company from 2003- present. As well as being a subsidiary
company Warner bros are also a conglomerate and parent company, parenting several subsidiary
companies, including Warner Bros. Studios, Warner Bros. Pictures, Warner Bros. Interactive
Entertainment, Warner Bros. Television, Warner Bros. Animation, Warner Home Video, New
Line Cinema, TheWB.com, and DC Entertainment. Warner owns half of The CW Television
Network. Warner bros has multiple enterprises making them a conglomerate; they have Warner
bros entertainment, Warner bros records and even Warner bros clothing, which have widened the
Warner brothers market.
Pathe
Independent film companies
An independent film company is a company that is not subsidiary to any companies although it
might be a parent company to other subsidiary companies. Independent films companies differ from
the six major film companies in many ways, which are mainly to do with their budget, brand
identity and accessibility to useful resources, this gives the major companies a big advantage over
independent companies. The main disadvantages of being an independent film company are the lack
of budge which makes it harder to have special effects and A-list actors. Independent companies
are also less popular, meaning viewers may see them as a less reliable source when it comes to
watching their film productions. The main advantages of being an independent company are that
they receive all profit, they have less pressure due to the fact that they have a smaller budget and
aren’t as popular as the major six. Another advantage is that they have complete control over what
they decide to produce, allowing them to have more choices and chances to become more unique.
•
Using one of your case studies – explain how the ownership of an independent
company may work.
Global companies

2. A global company is a company that can be recognised in multiple countries as a
corporation which produces and sells goods or services. Examples of film companies that
are owned by global companies are
What examples are there of film companies owned by Global companies
•
What are the advantages and disadvantages for a film company of being owned
by a Global company.
The advantages of a film company being owned by a global company are that
they will have higher funding which will increase the size of their budget.
Monopolies vs. Oligopolies
A monopoly is when single company is the only supplier of a specific product or service.
This means they have control of a complete market and have no or very little
competition, which allows them to decide the price of the product or service they
provide. An oligopoly is when a few companies dominate an industry. An example of a
monopoly is sky’s control over pay- TV movie rights in the UK is restricting competition
which is leading to higher prices and reduced choice. The commission may decide to
restrict the number of Hollywood studies from which sky currently has the rights to be
the first to air their new releases. Sky has twice as many pay- TV subscribers as all its
rivals combined, this shows how extreme their dominance of the market is. An example
of an oligopoly is the major six, which are the six leading film studios. The major six
consist of Sony pictures, Warner Bros. Entertainment, The Walt Disney Studios, NBC
Universal, Fox Entertainment and Paramount Motion Pictures, which together are the
six major film making studios worldwide. Those six studios usually get to produce the
more popular films due to the fact that they have a bigger budget than all of their
competition. The advantages of being a monopoly are the supernormal profit, which
could be used to fund high cost capital investment spending. Another advantage is
increased output which will lead to a decrease in average costs of production. The
advantages of being an oligopoly are they have a strong hold over the market, which
allows them to be able to make huge profits because they have little competition.
Another advantage is the companies have the capability to decide the prices of the
product or service they remain dominant of; they also make a greater long term profit
which is usually maintained. The disadvantages of monopolies are poor level of service,
no consumer sovereignty, consumers may be charged high prices for low quality of
goods and services and the lack of competition may lead to low quality and out dated
goods and services. The disadvantages of oligopolies are the prices set for the
consumers may be unrealistically high, it will cause more small companies to fail, due to
the lack of competition the dominant companies may not consider improving their
product, it will make it harder for smaller companies to become successful, the smaller
companies will be left with smaller profits and companies won’t be able to make

3. independent decisions and will always have to consider the views of other dominant
companies.
Vertical and horizontal integration
Vertical integration is when a company owns companies in multiple stages. This allows them to
increase their profit; this also gives them the opportunity to make 100% profits. Horizontal
integration is when a company owns multiple companies in one sector, which can allow them to
dominate a sector, making other companies have to come to them. Walt Disney Studios is an
example of both vertical and horizontal integration. They own companies in multiple sectors making
them vertically integrated; they also own multiple companies in one sector in the production cycle.
An example of a company that they own in the same sector is Marvel Entertainment. Due to the
amount of companies that Walt Disney Studios own in different and the same sector in the
production cycle, they are a conglomerate, which gives them an advantage over other companies
because they have increased their amount of ventures. Making more companies have to go to them
to do certain parts of production and allowing them to make more profit when producing their own
movies. Advantages of being vertically integrated is that they can reduce money spent on getting
through certain areas of the production cycle and the percentage of profit made increases, especially
if the company owns a company in every sector, that would allow them to make 100% profit.
Advantages of being horizontally integrated are that they can dominate a sector and force other
companies to come to them to progress in the production cycle. Monopoly could also take place
which will mean they can dictate the cost of progressing through a specific sector. The
disadvantages of being vertically integrated are increased bureaucratic costs, the decreased ability to
be able to increase product variety, lack of supplier competition and capacity balancing issues which
are having the capacity to provide downstream operations under demand. The disadvantages of
being horizontally integrated are the increased possibility of anti-trust prosecution, the poor track
record for maintaining innovation and potential collapse of organisation due to sector downturn.
Sources
http://Tutor2u.net/economics/revision-notes/as-marketfailure-competition-monopoly.html
http://en.wikipedia.org/wiki/Major_film_studio
http://www.economicshelp.org/microessays/markets/advantages-monopoly/
http://www.buzzle.com/articles/advantages-and-disadvantages-of-oligopoly.html
http://www.dineshbakshi.com/igcse-gcse-economics/private-firm-as-producer-andemployer/revision-notes/1306-monopoly