Intro Media Institutions

• PBS or Murdoch?• PBS – BBC, PBS America etc

Broadcasting

Press Cinema

Advertising

New Media

What Makes Up The Media Industries?

Who owns this?

• AOL – Time Warner

This?

News Int (News Corp)

This?

Also News Corp

How about this?

GE NBC Universal!

This one for a prize!

Viacom!

This?

• Gerald Levin, chief executive, AOL Time Warner , in a CNN discussion on the future of the media, a few days before the AOL Time Warner merger, predicted global media would become the dominant industry of the 21st century — so powerful that they might in fact become more powerful than governments. "So what's going to be necessary is that we're going to need to have corporations redefined as instruments of public service," he said, adding: "It's going to be forced anyhow because when you have a system that is constantly available everywhere in the world immediately, then the old-fashioned regulatory system has to give way."

Media Studies

• Media Concept Institutions

• Medium Examined Mass Media

• Topic Media Giants

Key Question

• Is media a business whose texts and products are to be sold to the consumers?

• Is media a public service, in which the emphasis is to inform, educate and entertain the people?

Public or Private Control?

Who will control those who control those who control?

A Watchdog

• Traditionally, the role of the media is to safeguard citizens’ rights by ensuring that public servants, including those who govern, are accountable to the people. It is the ‘fourth estate’ of government.

What about this convergence thing?

What are the types of convergence?

• Industry structure - Incentives for Global Markets, changes in customer demands require changes in revenue models

• Content – design process, production process, distribution process.

• Technology – hybrid devices to use multiple formats – the bit that Andreas is teaching.

REGULATION: Press• Self Regulation

– Voluntary code - PCC– www.pcc.org.uk

• Legal control – Libel – Jeopardize State Security – Diana/Dodi trial MI5 in

secret.– ‘Prejudice a Fair Trial’

• Campaign for Press & Broadcasting Freedom– www.cpbf.org.uk

Media as the ‘fourth estate’

• Parliament debates government policy

and makes laws• The Executive makes

and execute policy runs the government

• The Judiciary interprets and clarifies the law

• Media - a free press can report all government activity

Liberal notions of the media

• Rooted in the freedom of the press and the neutrality of the market.

• Plays a vital role in democracy;

• Media informs the electorate,

• Checks and critiques government;

• Articulates public opinion.

Radical Theory

• Media is profit motivated

• It generates content that garners the greatest profit.

• It tells what sells.• It is geared to

readership and audience tastes and prejudices.

• It cannot be unbiased or objective.

The Media Giants

Media Giants

• Bertelsman AG (Random House, BMG, Internet)

• News Corp (Murdoch, Fox,

Star TV, newspapers, Dodgers)

• Viacom (Paramount, Blockbuster, MTV, CBS)

• Vivendi/Universal (Music, studios, European media)

• AOL/Time Warner (Books, magazines, movies)

• Disney (ABC, Touchstone, sports, publishing)

Convergence

• Corporations own a variety of media outlets

• TV, radio, movies,

books, magazines

newspapers,

Internet

Media Monopolies

• .

Media ownership – the shrinking

• The rise of media conglomerates can be traced back to the 1980s & 1990s which saw a lot of mergers and buyouts of media and entertainment companies.

• Bagdikian, a media scholar who studied this phenomenon noted that the last twenty years witnessed a trend where the ownership of the media industry was increasingly concentrated in the hands of a few companies. For example, in 1983

• fifty corporations dominated most of every mass medium and the biggest media merger in history was a $340 million deal. ... [I]n 1987, the fifty companies had shrunk to twenty-nine. ... [I]n 1990, the twenty-nine had shrunk to twenty three. ... [I]n 1997, the biggest firms numbered ten and involved the $19 billion Disney-ABC deal, at the time the biggest media merger ever. ... [In 2000] AOL Time Warner's $350 billion merged corporation [was] more than 1,000 times larger [than the biggest deal of 1983].

Six Corporations own 90% of the U.S. media (newspapers, magazines, TV and radio stations, books, records, movies, videos, wire services, photo

agencies, and the Internet

Research tool Who owns what

The following information was found athttp://www.pbs.org/wgbh/pages/frontline/shows/cool/

giants/

Links between the Media Giants

Bertelsmann/Sony Corporation

• Japan-based Sony Corporation started in 1946 as Tokyo Telecommunications Engineering, with three employees. Now, it boasts more than 180,000 employees worldwide and over $58 billion in sales for 2001.

• BOOKS United States Random House; Ballantine; Fodor's; Knopf; Modern Library

• Book Clubs: Book-of-the-Month Club; Doubleday Book Club; Bookspan (50 percent)

• Canada Random House of Canada; Quebec Loisirs Book Club

• U.K. Random House; Book CLUB BCA (U.K.); European Book Clubs; Bertelsmann Media (Switzerland); Circulo de Lectores (Spain); Circulo de Leitores (Portugal); Donauland (Austria); ECI (Netherlands); France Loisirs (France); Swiat Ksiazki (Poland)

• Sudamericana • Pacific

Random House Australia; Random House New Zealand • Germany

Berlin Verlag; C. Bertelsmann Springer Verlag; and 15 other imprints covering all aspects of book publishing; Book Club Der Club

• Online book sales Barnes&Noble.com (40 percent); BOL

• TELEVISION /RADIO CLT-UFA (merger of Audiofina, CLY-UFA and Pearson Television)

• Television Stations: Germany RTL; RTL-2 (34.5 percent); SUPER RTL (50 percent, with Disney); Premiere World (5 percent, with KirchPayTV); VOX (joint venture with News Corporation)

• England Channel 5

• France FUN TV; M6; Multivision Teva

• Netherlands RTL-4; RTL-5; RTL-9; RTL-Tele Letzebuerg

• Hungary RTL Klub

• Hungary RTL Klub

• Television Production: UFA Film and Television Production; Trebitsch Production; Delux Productions (Luxembourg); Cinevideo (Canada); Holland Media House (Netherlands); Pearson TV (U.K.); UFA Sports

• Radio: France Radio RTL; RTL 2; Fun Radio

• Germany Antenne Bayern; 104.6 RTL; Radio Hamburg; Radio NRW; RTL Radio

• Belgium Bel RTL

• Sweden 104.7 RTL; Wow 105.5

• U.K. Atlantic 252

• "With 22 television stations and 18 radio stations in ten countries, RTL Group is Europe's biggest broadcasting corporation."

• — www.bertelsmann.com/tv • MAGAZINES

Gruner Jahr is Bertelsmann's magazine division, publishing 80 magazines worldwide.

• USA American Homestyle; Family Circle Inc.; McCalls; Parents

• France Femme; National Geographic and 13 other magazines

• Germany Stern; TV Today; Impulse Brigitte; and 17 other magazines

• U.K. Best; Prima; Focus - and this is just the tip of the iceberg!!!

Just the one book company…

• "Today, Bertelsmann is the world's largest publisher. Our U.S. publishing group Random House alone ships over one million books a day." — www.bertelsmann.com/book

• The Sony Bit of Sony BMG ----

• Movielink (jointly owned with Paramount Pictures, Sony Pictures Entertainment,  Universal Studios and Warner Bros. Studios)

Music• Sony BMG Music

Entertainment (50% with Bertelsmann)Labels include: Arista Records, BMG Classics, BMG Heritage, BMG International Companies, Columbia Records, Epic Records, J Records, Jive Records, LaFace Records, Legacy Recordings, RCA Records,

Film• Sony Pictures Entertainment • Columbia TriStar • Sony Pictures Classics • Screen Gems Television• Sony Pictures Television • AXN • Animax Japan • SoapCity • GAME SHOW NETWORK

(50% with Liberty Media)

• RCA Victor Group, RLG - Nashville, Sony Classical, Sony Music International, Sony Music Nashville, Sony Wonder, So So Def Records, Verity Records

• Sony/ATV Music Publishing (joint venture with Michael Jackson)

• Music Choice (venture with Time Warner, EMI, Motorola, Microsoft, and several cable companies: Cox, Comcast, Adelphia, Time Warner Cable)

Other• Sony Electronics • Sony Computer

Entertainment America • PlayStation • 989 Sports • Sony Connect Inc. • Metreon

Walt Disney Co

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

Walt Disney CompanyRevenues: $25.4 Billion

• Television• ABC, Disney Channel; Toon Disney; Soap Net; ESPN, ESPN2, Lifetime

and Lifetime Movie Network; Disney and ESPN channels in more than 140 countries; Production including Buena Vista, Touchstone, Walt Disney, ABC Entertainment

• Magazines• US Weekly, Discover, Family Fun, Disney Adventures, ESPN The

Magazine, Talk• Books

• Hyperion, Talk Miramax, Disney Children’s Book Group, ESPN Books, ABC Daytime Press

• Resorts• Disney World, Disneyland, Disney Cruise Line, Disney Vacation Club,

Tokyo Disney, Disneyland Paris, Hong Kong Disneyland, ESPN Zone• Movies

• Walt Disney Pictures, Touchstone Pictures, Hollywood Pictures, Miramax Film Corp., Dimension, Buena Vista International

• Other• 50 radio stations; ABC Radio Network; Radio Disney; ESPN Radio• Sports teams: Mighty Ducks, Anaheim Angels• Theatrical productions of Beauty and the Beast, The Lion King, The

Hunchback of Notre Dame, and Aida; 741 stores and Disney catalog• Licenses characters for clothes, toys, etc. and for teaching aids;

videos/films for schools; stakes in sites including NFL.com and Movies.com; markets cell art from Disney animated films; owns Celebration, FL (a 4,900-acre town)

Little old ESPN (Disney)

• "ESPN International dominates televised sport, broadcasting on a 24-hour basis in 21 languages to over 165 countries. It reaches the one desirable audience that had eluded Disney in the past: young, single, middle-class men. 'Our plan is to think globally but to customize locally,' states the senior vice president of ESPN International in Latin America. The emphasis is on soccer; in Asia it is table tennis; and in India ESPN provided over 1,000 hours of cricket in 1995." — Robert W. McChesney, "The Global Media Giants" in Extra!, November/December, 1997

Disney and Pixar

AOL Time WarnerThe Big One

• In January 2001, the $165 billion mega-merger between AOL and Time Warner was the largest media merger in history.

• The new company promised integrated communication, media and entertainment across all platforms.

• But shares of the company fell off sharply in the two years following the merger.

• Heading into 2003, U.S. Justice Department has opened inquiries into AOL's accounting practices prior to the 2001 merger.

• Employing an estimated 84,900 employees, AOL Timer-Warner earned USD 43.7 billion in 2005.

• As can be observed, this media conglomerate owned different media businesses which operates worldwide.

AOL / Time WarnerRevenues: $36.2 Billion

• Television and Cable• WB, HBO and Cinemax, Comedy Central, Court TV, E! and Style, TBS, TNT, Cartoon

Network, Turner Classic Movies, CNN, Headline News; Second largest provider of cable

• Movies• Warner Brothers, New Line, Fine Line, MGM, RKO, Warner Home Video, UCI, WF

Cinema, Castle Rock• Music

• Warner Bros, Atlantic, Elektra, London-Sire, Rhino Records, majority interest in Alternative Distribution Alliance, Quincy Jones Entertainment, Warner/Chappell

• Books• Warner Books, Little, Brown, Time-Life Books, Book-of-the-Month Club

• Internet• America Online, CompuServe, Netscape, ICQ, aol Instant Messenger; websites

include MusicNet, EMI, RealNetworks, Mapquest, Winamp, RoadRunner cable• Magazines

• More than 64 magazines including the 3 best selling: Time, Life, and People; Fortune, Sports Illustrated, DC Comics; IPC (leading in Britain)

• Other• Sports teams including Atlanta Braves, Atlanta Hawks, Atlanta Thrashers, Goodwill

Games, Phillips Arena; Warner Bros. Movie World Theme Park, Time Warner Telecom, Warner Bros. Studio Stores, DC Comics, Hanna Barbera characters, WB properties

“AOL Everywhere”

• Cable Broadband– Potential to solve AOL’s

broadband strategy– Powerful means to deliver

content• Publishing Industry

– Brand extension opportunities: Online sites

• Music Industry– Potentially huge market for

music downloads• Cable Industry

– AOL TV: capitalize on our TV habit

– Platform for other media devices

• Film Industry– Promotion: movie clips, plot

tests– Interactive HDTV

AOL / Time WarnerRevenues: $36.2 Billion

• Television and Cable• WB, HBO and Cinemax, Comedy Central, Court TV, E! and Style, TBS, TNT, Cartoon

Network, Turner Classic Movies, CNN, Headline News; Second largest provider of cable

• Movies• Warner Brothers, New Line, Fine Line, MGM, RKO, Warner Home Video, UCI, WF

Cinema, Castle Rock• Music

• Warner Bros, Atlantic, Elektra, London-Sire, Rhino Records, majority interest in Alternative Distribution Alliance, Quincy Jones Entertainment, Warner/Chappell

• Books• Warner Books, Little, Brown, Time-Life Books, Book-of-the-Month Club

• Internet• America Online, CompuServe, Netscape, ICQ, aol Instant Messenger; websites

include MusicNet, EMI, RealNetworks, Mapquest, Winamp, RoadRunner cable• Magazines

• More than 64 magazines including the 3 best selling: Time, Life, and People; Fortune, Sports Illustrated, DC Comics; IPC (leading in Britain)

• Other• Sports teams including Atlanta Braves, Atlanta Hawks, Atlanta Thrashers, Goodwill

Games, Phillips Arena; Warner Bros. Movie World Theme Park, Time Warner Telecom, Warner Bros. Studio Stores, DC Comics, Hanna Barbera characters, WB properties

Vivendi Universal (Also known as GE NBC

Universal)• Created in December. A merger combined Vivendi's

telecommunications assets with Universal Studios and Canal+'s programming and broadcast capacity.

• Vivendi Universal's subsidiary Universal Music Group is the world's top music company, with roughly 22% of the global market share in 1999.

• Heading into 2003, the company plans to sell off $16

billion in assets because of massive debts.

Vivendi Universal• USA Network, Sci-Fi Channel;

Universal Studios; Leading French publisher; Houghton Mifflin publishers, medical & reference books and CDs; 27% of US music sales: Interscope, Geffen, A&M, Island, Def Jam, MCA, Mercury, Motown, Universal; Universal Studios, StudioCanal, PolyGram Films, Gramercy; info technology and medical journals; theme parks (Universal Studios & SEGA Game Works), stores inc. Spencer Gifts; Second largest private water rights owner in the world; 151 recycling facilities, 119 landfill sites, 83 incineration plants worldwide

• June 14, 2000 Announcement that Vivendi and Seagram in merger talks. It was reported as one more global media merger, creating a $55 billion group, Europe's version of AOL Time Warner.

• October, 2000 Mario Monti, EU Competition Commissioner, clears merger. Terms include selling Vivendi's stake in BSkyB and making Universal's library available to rival media groups on fair terms. Company to also sell 55 percent held in ISP AOL France. After Seagram and Canal Plus shareholders agreed on merger, Vivendi Universal began trading on December 11, 2000. A month later shares in the company had fallen by 12 percent.

Just the tv and film bits…• TELEVISION and FILM

Canal 14 million subscriptions to pay-TV in 11 European countries. Main companies include CanalSatellite; StudioCanal; Canal ; Spain Telepiu; Canal Digital.

• Universal Studios; Universal Pictures; Universal Studios Home Video; Universal Television & Networks Group (4,000 film titles, 24,000 television episodes of such series as "Kojak," "Miami Vice," "Columbo"). Several theme channels, including SciFi (U.K.) Action and Suspense Channel; 13ème Rue; USA Network.

• Distribution Cineplex Odeon Corporation (42 percent) Cinema International Corporation (49 percent) United Cinemaa International (49 percent)

General ElectricRevenues: $129.9 Billion

• Television• NBC, CNBC, MSNBC, A&E, History and Biography channels (shared),

Snap TV, AMC, Bravo, WE, and Independent Film Channel; regional news, sports, and entertainment channels; Canal de Noticias NBC and TV Azteca; Production including NBC Productions, Radio City Television, Bravo Original Programming, IFC Productions, Next Wave Films, Satellite DBS Provider

• Internet• Snap, NBC.com, CNBC.com, Salon.com, polo.com

• Other• Ammonia plants, Nuclear reactors • Aircraft engines; GE, Hotpoint & other appliances; light bulbs • 14 communications satellites, cars, computers • MR and CT scanners, X-ray and ultrasound machines • Health, accident, and long term care insurance; investment and

retirement plans; mortgages, home equity and commercial real estate loans, car loans,

• Credit card application processing, sales authorization, and collection services for retailers in 23 countries

• Owns stock in retail, financial services, telecommunications, healthcare, food and beverages, cable and broadcasting industries; leases 1,000 aircraft, 190,000 railcars, and about 1 million cars, trucks, and tractor trailers

Viacom, Inc.Revenues: $20 Billion

• Television• CBS, UPN, MTV, MTV2, VH1, Showtime, Nickelodeon, Noggin, Nickelodeon

GAS, TV Land, Comedy Central, TNN, CMT, The Movie Channel, Sundance Channel, FLIX, BET

• Movies• Paramount Pictures, Nickelodeon Movies, MTV Films, BET Arabesque

Films; Blockbuster; about 1,800 screens in theaters in the US, Canada, Europe, Asia, and South America

• Books• Simon and Schuster, Pocket Books, Scribner, The Free Press, Arabesque

Books; divisions in Britain and Australia• Internet

• MTV.com, VH1.com, Nickelodeon Online, stakes in iWon, Sportsline.com, MarketWatch.com, hollywood.com

• Music• 184 Infinity radio stations; CBS Radio Network; Westwood One, Sportsline

Radio; Famous Music holds copyright to more than 100,000 musical works• Other

• Paramount theme parks in US and Canada including Star Trek, The Experience, House of Blues, theme restaurants, World Wrestling Federation Entertainment

• Exclusive advertising rights on buses, subways, trains, kiosks, billboards, and other venues in New York, L.A., Chicago, San Francisco, Philadelphia, Detroit, Houston, Atlanta, and 82 other US cities and cities in Mexico, Canada, Britain, Ireland, and throughout Europe

Viacom, Inc.Revenues: $20 Billion

• Television• CBS, UPN, MTV, MTV2, VH1, Showtime, Nickelodeon, Noggin, Nickelodeon

GAS, TV Land, Comedy Central, TNN, CMT, The Movie Channel, Sundance Channel, FLIX, BET

• Movies• Paramount Pictures, Nickelodeon Movies, MTV Films, BET Arabesque

Films; Blockbuster; about 1,800 screens in theaters in the US, Canada, Europe, Asia, and South America

• Books• Simon and Schuster, Pocket Books, Scribner, The Free Press, Arabesque

Books; divisions in Britain and Australia• Internet

• MTV.com, VH1.com, Nickelodeon Online, stakes in iWon, Sportsline.com, MarketWatch.com, hollywood.com

• Music• 184 Infinity radio stations; CBS Radio Network; Westwood One, Sportsline

Radio; Famous Music holds copyright to more than 100,000 musical works• Other

• Paramount theme parks in US and Canada including Star Trek, The Experience, House of Blues, theme restaurants, World Wrestling Federation Entertainment

• Exclusive advertising rights on buses, subways, trains, kiosks, billboards, and other venues in New York, L.A., Chicago, San Francisco, Philadelphia, Detroit, Houston, Atlanta, and 82 other US cities and cities in Mexico, Canada, Britain, Ireland, and throughout Europe

Vertical Integration as Basic Characteristics of Media Conglomerates

The Profit Motive

• Essentially, all activities of the media industry centered around the creation and packaging of intellectual property with the aim of maximizing revenues by selling it as many times as is feasible to the widest audience.

• Given its aim of revenue maximization, the media industry have focused on the vertical integration business strategy.

What is Vertical Integration

• This term describes a style of ownership and control where a group of companies are united through a hierarchy and share a common owner where each member of the hierarchy produces a different product or service, and the products combine to satisfy a common need.

• The idea behind vertical integration is that all activities of an industry are ordered in a sequence which starts ‘upstream’ at the early stages in the production process, works its way through succeeding or ‘downstream’ stages where the product is processed and refined, and finishes up as it is supplied or sold to the customer.

• Also known as vertical supply chain.

The Media Supply Chain

Production:creating media

content

Packaging: content is collected together & assembled as media product

Distribution:delivering Product to customers

News Corporation

• Rupert Murdoch's News Corporation Ltd. Has media holdings in the U.S., Canada, Europe, Australia, Latin America and Asia.

• As of September 30, 2000, its assets totaled $38 billion and total annual revenues approximate $14 billion.

• In 2003, the company is seeking to acquire DirectTV, a

U.S. satellite tv company.

Vertical Integration?

News Corporation (Murdoch)Revenues: $11.6 Billion

• Television• FOX, FX, FMC, Fox News Channel, National Geographic Channel,

Speedvision and Outdoor Life, Fox international sports channels, Golf Channel, Health Network, Television Games Network, TV Guide Channel, internationally extensive holdings in cable, broadcast, and satellite TV in Asia, Europe, Latin America, and Australia

• Production including Twentieth Century Fox, Regency Television among others

• Books• HarperCollins (and all its imprints), Zondervan (largest commercial

Bible imprint)• Newspapers & Magazines

• TV Guide, NY Post, the Star, the Boston Herald; in Britain: The Sun, the London Times, News of the World, the Australian, the Daily Telegraph, the Herald Sun

• Movies• Twentieth Century Fox, Fox 2000, Fox Searchlight, Fox Animation

Studios, New Regency, Fox Home Entertainment, Fox film library• Other

• Weekly Standard, TV Guide, stakes in internet sites including ChinaByte.com and broadsystem.com, licenses for The Simpsons, X-Files, and other Fox properties

• Sports including New York Knicks, New York Rangers, New York Liberty, New England Seawolves, Hartford Wolfpack, Madison Square Garden, management of Hartford Civic Center; Los Angeles Dodgers and Staples Center, Dodger Stadium and Dodgertown; National Rugby League

BSkyB News and Manchester United

Murdoch Soccer Deal Sets Up Bigger Play Goals for Media Empire Motivate $1-Billion Purchase of Famed Team MARJORIE MILLER, Times Staff Writer LONDON--There is one reason media mogul Rupert Murdoch would spend $1 billion and change to buy Britain's most revered soccer team--more than three times what he paid for the Los Angeles Dodgers--and it is not just to tweak the noses of Manchester United fans.      Even more than potential profits, owning one of the leading teams in the world's most popular sport gives Murdoch's News Corp. enormous clout with broadcasters worldwide, while guaranteeing that its games never leave the company's flagship satellite service, British Sky Broadcasting, an international cable news and entertainment network that is the dominant pay television source in Britain.

Have A Nice Day? • "Our reach is unmatched around the world.

We're reaching people from the moment they wake up until they fall asleep. We give them their morning weather and traffic reports through our television outlets around the world. We enlighten and entertain them with such newspapers as The New York Post and The Times (of London) as they have breakfast, or take the train to work. We update their stock prices and give them the world's biggest news stories every day through such news channels as Fox or Sky News ... And when they get home in the evening we're there to entertain them with compelling first-run entertainment on FOX or the day's biggest game on our broadcast, satellite and cable networks. Before going to bed, we give them the latest news, and then they crawl into bed with one of our best-selling novels from HarperCollins." — Rupert Murdoch, News Corporation, 1999 Annual Report

The wird one - General Electric

Revenues: $129.9 Billion• Television• NBC, CNBC, MSNBC, A&E, History and Biography channels (shared),

Snap TV, AMC, Bravo, WE, and Independent Film Channel; regional news, sports, and entertainment channels; Canal de Noticias NBC and TV Azteca; Production including NBC Productions, Radio City Television, Bravo Original Programming, IFC Productions, Next Wave Films, Satellite DBS Provider

• Internet• Snap, NBC.com, CNBC.com, Salon.com, polo.com

• Other• Ammonia plants, Nuclear reactors • Aircraft engines; GE, Hotpoint & other appliances; light bulbs • 14 communications satellites, cars, computers • MR and CT scanners, X-ray and ultrasound machines • Health, accident, and long term care insurance; investment and

retirement plans; mortgages, home equity and commercial real estate loans, car loans,

• Credit card application processing, sales authorization, and collection services for retailers in 23 countries

• Owns stock in retail, financial services, telecommunications, healthcare, food and beverages, cable and broadcasting industries; leases 1,000 aircraft, 190,000 railcars, and about 1 million cars, trucks, and tractor trailers

Vertical is up-down…

• By controlling the media vertical supply chain, a conglomerate can generate enormous profit out of its media products.

• Therefore, if a media conglomerate has a successful movie, it could promote the file through its broadcast properties, and then use the film to spin off TV programs, musical CDs, books, merchandise, etc.

• As Viacom’s CEO Redstone put it: “When you make a movie for an average cost of $10 million and then cross promote and sell it off of magazines, books, products, television shows out of your own company, the profit potential is enormous.”

• For example, Disney’s 1994 animated film The Lion King generated over USD 1 billion in profit. It also led to a lucrative Broadway show, a TV series and all sorts

of media spin-offs. It also led to 186 items of merchandising.

• The common parlance for such practice is ‘synergy’ which attempts to boost sales by promoting products across media where for every ‘hit’ movie (or any other media product) there is a TV series, soundtracks, books, plastic mugs, etc.

• In another example of ‘synergy,’ Disney takes its lucrative ESPN cable channel and use the name to generate other

products, including ESPN radio network. In 1996, Disney launched ESPN Magazine to compete directly with AOL-Timer Warner’s Sports Illustrated. Using incessant promotion on ESPN, the magazine exceeded initial estimates with a circulation approaching 500,000 after a few months. This resulted in the launch of ESPN Grill restaurants to appeal to those who wish to combine sports with dining out.

Synergy

• Corporations cross-

promote products

• Dreamworks Shrek

ignored by Disney

media

• CNN plugs Turner

Classic Movies

• NBC promotes GE-

backed airplane

Average American heard 42 mentions by time film opened

Batman Synergy

Divine secrets of Ya Ya synergy

• 2002 Time-Warner-AOL film Divine Secrets of the Ya Ya Sisterhood

• Location of key scene changed from New York Times to Time magazine

• HBO showed Media show 28 Days almost daily

• Sometimes followed by HBO Behind the Scenes: The Ya Ya Sisterhood

BUT . . .

• Time magazine gave the film a mediocre review

• Media synergy doesn't influence all content

• Not yet . . .

Conflicts of Interest?

• Disney owns ABC

• How does ABC cover Disney?

• How does Time-Warner-AOL cover its many interests?

The Power of The Few

Media power

• The study of power relations forms the basis of the study of media and communications.

•  Power and knowledge are closely interlinked.

What is power?

• Power is the means by which certain individuals and groups are able to dominate others

• Power is potentially or actually part of all social relationships

• Usually a person who has control also has power

• Media Power is exerted by controlling the informational environment, system of influences, commands and feedback

Newspaper organization

P ress m an ag er C ircu la tion

S u b -ed ito rs

C h ie f su b -ed ito r

N ews E d ito r

R ep orte rs

C h ie f R ep orte r S p ec ia l corresp on d en t

P h otog rap h ers

P h oto E d ito r

C h ie f o f N ews B u reau

R ep orte rs / su b -ed ito rs

S p orts E d ito r

C orresp on d en ts

F ore ig n E d ito r

E d ito r A d vertis in g m an ag er

P rop rie to r

Who has power over media content?

• Traditionally = Editors• Now?

– Competition in the market place?– Interest groups?– Advertisers?– Audience? – Readers?– Government?– Owners?

How can outside influence control

editorial decisions?• Operational: Control of editors / reporters

• Allocative: Through the allocation of funds / personnel for

certain programs or certain sections of the newspaper denial of funds for other sections or programs

• External: Pressure from advertisers / consumer groups 

Media Diversity• Media diversity is when media

outlets are owned by a number of persons making diversity of opinion a realistic expectation.

• Democratic governments attempt to ensure diversity and are wary of concentration in media ownership.

• Governments attempt to ensure diversity and are wary of concentration in media ownership

Convergenceand Diversity

• Corporations own a variety of media outlets and shops

• TV, radio, movies,

books, magazines

newspapers,

Internet

• In effect this

reduces choice and

diversity

Or

Critics of consolidation

• Mergers limit number of independent voices in media

• Limits free exchange of ideas

• Facilitates censorship

• Profit imperative, rather than quality, determines programming

Rupert Murdoch as Mao

Government controls on media

• Airwaves are in the

the public domain

• Radio /TV bound

by public service

requirements.

• BUT Governments

are reducing limits

on media

consolidation

• More choice at

lower prices?

Corporations and Culture

• Fewer media businesses = less choice of opinion?

• Corporations control more culture industries

• This drags down standards

• Leads to more “trash”

• Future of freedom of speech

Oligarchy powers

• Monopolies are

non-competitive• Hypercommercializ

e content without fear of competitive retribution

• US commercial radio = 18 minutes of ads per hour

• Low quality populist output

Media Moguls

• ‘Media moguls” are persons who own and operate large media corporations in a personal or eccentric style

• Moguls occur when there are one or a few players in the media scene

• Gives rise to fears of the reflection of one point of view.

Censorship

• Rupert Murdoch's (News Corp.)• HarperCollins cancelled

publication of book by Chris Patten former British Government of Hong Kong

• Why?• Patten critical China• Fact. News Corporation has huge

interests in China

• Self-censorship an even greater concern

Conclusion: Should I be Concerned?

• Historically speaking, the origins of what we term as the media has its roots in newspapers that proliferated in the 19th century.

• The function of newspapers was to inform and educate its readers on the issues of the day as well as disseminating ideas.

• However, the 20th century have witnessed the gradual evolution of the media that moves away from news to entertainment.

• And the trend in media ownership in the past twenty years is simply accelerating the media’s move towards entertainment.

• With the emphasis towards profitability, rather than social responsibility, media content have increasingly been watered (some would say dumbed) down in an effort to entertain us rather than inform and educate us (or what Neil Postman calls as “Amusing Ourselves to Death.”

• And given the pervasiveness of the media in our lives, its influence is undeniable.

• We are what we read, see and hear through the media. And the message of the media is simply this ‘Resistance is futile. Become part of the mindless audience hive that consumes what we offer.’

The Future? Research Questions

• Can the internet and other new technology break the hold of the media giants?

• Is the influence of the media giants benign or harmful to democracy and freedom?

• Is too much power in the hand of too few?

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Entertainment Industry Value Chains

The Future??

Rippers Bittorrents Downloads

• The big guys fight back!

Insight on Technology: Hollywood Needs a New

Script• Digital videos available on P2P networks threaten existing Hollywood business models

• Industry system of distribution windows to stage release of new films being ripped apart by digital pirates

• Hollywood has hired a “police force” that trolls Internet looking for free copies of movies,and then sends infringement letters to offenders Questionable how effective this will be

• Legitimate alternative: Movielink a joint venture of 5 studios

Homework - Yes Homework

• For the next 3 days, you will keep a log of the media that you spend time with together with a brief note of the content of such media.

• Please create a blog (weblog) of all your media consumption