Isla Dhillon

L01:
Understand the structure and ownership of the
media sector, produce a television advertisement
In order to gain the job you desire in the media industry you will need to
prove your understanding of the business by comprehensively explaining the
structure and ownership of the media sector with references to elucidated
examples
Ownership within your
chosen sector
Vertical integration

include
Who are the big companies?

Conglomerate

What is it?
Examples of it within the film industry
What is it?
Examples of it within the film industry
Definition

Multinational

Definition

Horizontal integration

Ownership in you chosen sector

Who are the big companies from your sector?
In my chosen sector TV, the big companies (ownership) within the British TV
industry are BBC which is a PSB- funded channel and ITV, channel 4 and five
which are all funded to run by advertising.
Example of privately owned company who owns them? Are
they successful?
Examples of media they have produced.
Sky is a privately owned company within the TV industry. Sky plc is a
pan-European satellite broadcasting, on-demand Internet streaming
media, broadband and telephone Services Company. Skys
headquarters are in London and the founder of sky is Rupert
Murdoch. Sky is one of the most successful privately owned
companies in United Kingdom, Ireland, Italy, Australia and Germany.
Its Europes most leading entertainment companies as it available
outside of the UK in countries such as Italy and Germany, serving 20
million customers across five countries. Sky owns three and has
cooperated with this company to make the three sky business,
combining their strengths to benefit customers to make them even
better together, they have the opportunity to create a more

Isla Dhillon

successful business that will shape and lead the TV industry further,
this will help benefit customers as new services are available and
they accelerate innovation across the markets they are operating
within. Sky has also cooperated with other companies such as o2 to
launch a mobile network. Examples of media sky have produced are
sky sports which is where you can watch sports on sky TV on
different sports channels, sky broadband which is a broadband box
which enables you to access Wi-Fi, another example of media
produced by sky is on-demand internet streaming media which
enables you to watch programmes and films whenever you want
wherever you are.
Cross media is regulated within sky. Cross media is regulated within
sky as they are in cooperation with other companies such as three
and o2 so they have shares within each other as they are multiple
Medias/ companies that have come together. Sky has a wide range
of diversity within products as they work within different areas, such
as sky news, broadband, sky sports, this can be bought in a sky
package, they make a wide range of different products that increase
their audience share and success, this makes the company more
resistant to economic pressures. They have diverts within their
product range by having different products. By having product
diversity and a diverse range of products this help income as it its
targeting different audiences/ customers so its reaching into a
bigger market places. Sky is the UKs largest pay-tv broadcaster, its
39.1% owned by news cooperation, by sky having multiple products
and programmes available such as news, sky sports, sky movies, sky
broadband, Wi-Fi, HD TV and 3D TV, this has increased the
companys income as well as profit, (2015) in the three months
leading to September 2015 skys profit rose by 10% to 375m, the
revenue increased by 6% totalling to 2.8bn. These figures
represent skys sturdiest first quarter growth for the past four years.
The increase of profit help to increase the customer base for the
company as by the profit increasing this can enable the company to
produce more products which can help to reach out to different
target audience and consumers and help the company develop more
products which broaden the customer base within the company by
providing more for the customers.
D o e s t h i s c o m p a n y o w n a n y c o m p a n i e s f ro m o t h e r
m e d i a sectors?
How is cross media regulated?
How does working across multiple sectors help product
diversity?
Example of product diversity

Isla Dhillon

H o w d o e s h a v i n g a d i v e r s e r a n g e o f p ro d u c t s h e l p
with income?
D o e s i t i n c re a s e p ro fi t ? s u p p o r t w i t h s o m e c o m p a n y
p ro fi t fi g u re s
H o w d o e s i t b ro a d e n t h e c u s t o m e r b a s e f o r t h e
company?
Example of independent company Are they successful? How
successful are they compared to the private companies?
Examples of media they have produced. What are the
organisational objectives of independent companies?
Nickelodeon is an independent company which is part of sky and
is one of the many hundreds of channel options. They are very
successful company and have many of the most popular and well
known programs such as sponge-bob square pants and The Fairly
OddParents as well as producing programmes for Nicktoons
another channel within their company. They produce programmes
that are mostly watched and targeted at teen and children
audiences, they are a very successful as they produce some of
the most well knows programme series. They are very successful

compared to private companies such as HBO as they produce and

show a commercial free childrens channel which is very popular.

Vertical Integration
What is vertical integration? Give example of vertical integration in
your chosen sector, this should be an example of a takeover.

Isla Dhillon

http://www.investopedia.com/terms/v/verticalintegration.asp

Vertical integration is when a company widen their business to help

expand aspects of their production path. This can help decrease
costs and contribute to improving the efficiency of this company. An
example of where this could be used within the TV industry could be
when a company such as nickelodeon take control over the whole of
nicktoons and help them produce and improve channels they show
to therefore improve the overall efficiently of the company as
nicktoons is a part of nickelodeon, therefore if nicktoons wasnt
doing as well as expected it wouldnt directly affect nickelodeon but
would be decreases the success of a part of the company.

Horizontal Integration
What is horizontal integration? Give an example of horizontal
integration in your chosen sector! This should be an example of a
merger
Is integration good for your sector? Does it increase or decrease
competition?
What are multinationals? Give examples

Isla Dhillon

Horizontal integration is acquisition or internal creation of a related

business, so its basically the creation of a similar business within
the same company. An example of Horizontal integration within my
chosen sector could be nickelodeon which is a big company within
the TV industry which then has created a similar channel/ business
within their company which s nicktoons. They are separate channels
within the same company which helps expand the audience/
viewings of this channels and will therefore expand the
successfulness of the company overall creating a combine of
competitors.
Interrogation is good for my chosen sector- TV industry as it helps
create a wider range of viewers of programs such as for companies
like nickelodeon as it helps expand on its production path and also
helps create efficiency within the company helping decrease costs
and contributing to the companys success. Interrogation I think
creates more competition as this company has other businesses
within the company which work together to make the business more
successful and harder to compete against as within sky they have
different firms within the company which individually are successful
so together even more enhanced.
Sky is also a good example of integration as within this company it
has produced additional business that are the same level of value
within the industry such as Sky news, Sky movies and sky sports
therefore increasing competition making it harder for other
companies that are competing against sky to be successful as they
have many aspects/ businesses within their company which overall
make the business more effective and popular.
A multinational is a company that is operating within different
countries. Sky is a multinational as it is operating within different
countries such as the United Kingdom, Ireland, Italy, Australia and

Isla Dhillon

Germany. Its Europes most leading entertainment companies as it

available outside of the UK, therefore by sky being multinational
their business is extensively increased.

What are conglomerates? Give examples

This is a cooperation that is made up of different seemingly

unrelated businesses. So its basically a big company which
owns a range of smaller companies.
Sky is a conglomerate as is owns different businesses such
as sky broadband, and has many smaller business within it
such as having different channels like sky sports, sky news
etc. the benefit of being part of a conglomerate they have a
greater market place and more customers as well as overall
improving the business success., another advantage is that
by having many different businesses within a company e.g.
Virgin have a broadband, an airline and a TV cable, In
Iceland when the volcano
Thy overcome adversity and have resilience by having
different companies within their business, so with virgin
with the airline couldnt run when in Iceland when the
volcano erupted but this didnt corrupt the business as they
had resilience by having income front eh other smaller
businesss within their company.

Isla Dhillon

Bibliography
http://www.slideshare.net/jphibbert1979/media-ownershiprevision?next_slideshow=1
http://www.investopedia.com/terms/h/horizontalintegration.asp
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https://corporate.sky.com/documents/publications-andreports/2014/sky-bigger-picture-2014-report.pdf

Isla Dhillon

http://www.managementtoday.co.uk/go/bskyb/
https://www.google.co.uk/webhp?sourceid=chromeinstant&ion=1&espv=2&ie=UTF8#safe=active&q=sky+financial+history
https://en.wikipedia.org/wiki/Nickelodeon_Animation_Studio
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http://smallbusiness.chron.com/examples-vertically-integratedcompanies-12868.html
http://www.investopedia.com/terms/h/horizontalintegration.asp