Unit 8 - Structures of media organisations

                                Unit 8 – Structures of media organisations

 

 

Horizontal integration is where a production company expands into the other areas of one industry, this means that the company can develop in a particular area of production or they can buy out another company that deals with these areas. Benefits of horizontal integration could be

• A more strengthened presence in the reference market
• This also helps them to engage in monopoly pricing (monopoly pricing is a strategy followed by a seller where the seller can maximize his or her profit without having to worry about any kind of competition.)

 

The drawbacks of horizontal integration are

• Decentralized structure could lead to a “loose ship”, as the team and projects leaders have high levels of responsibility for achieving results but little real authority over their team members.
• A resulting lack of control can lead to finger-pointing when things go awry, which can hinder productivity.

Vertical integration is when the production company has the ownership of the means of production, distribution and exhibition of the film by the same company, because of this they receive all of the profit. Benefits of this,

• There’s more control over the value chain. When retailers decide to acquire to develop a manufacturing business, they get more control over the production part of the distribution process.
• It enables you to invest in greatly specialized assets. This is great because there’s advantages that you could obtain over your competitors.

The draw backs of vertical integration

• It decreases flexibility. This is because of the downstream or upstream investments that the business will make.
• The capacity balancing problems, for instance the business, may need to establish excess upstream capacity in order to ensure that the downstream operations will have enough supply under any demand conditions.

Co operatives

The media cooperatives is a relatively new form of cooperative. They are a form of alternative media, critical of capitalism, with left-wing stances. Media Cooperatives are a special form of service cooperative, in which customers and service providers usually unite to oppose the pure profit motive. In contrast to mainstream media companies, media cooperatives pursue more idealistic goals.

2. Codes of practice – there are many contents which you have to go through with the codes of practice