Media Company Case Study

Task 1 Understand the structure

and ownership of the media sector

Callum Wallace

A privately owned company that generates its revenue mainly through advertising. Such as the TV company ITV http://www.itv.com/ The primary focus of the private (or commercial) media outlet is surviving in the marketplace and producing profit.

http://www.investopedia.com/terms/p/privatecompany.asp

The advantages of this way of ownership is that it can be more profitable overall. But a disadvantage is that advertising companies could dictate what is broadcast on your station and you could become the advertisers puppets.

http://www.globalization101.org/ownership/

Types of ownership: private ownership

Public service does not have advertising and generates revenue through the public (license fee) paying for it and in return they provide services for the public there main principles are;

universal accessibility (geographic) universal appeal (general tastes and interests) particular attention to minorities contribution to sense of national identity and community distance from vested interests direct funding and universality of payment competition in good programming rather than numbers guidelines that liberate rather than restrict programme-makers

The advantages of this are that it usually makes for better broadcasting e.g. shows. Because the programme makers are given more freedom because they aren't dictated by advertising companies. A disadvantage is that it may not generate as much money as a privately owned company.

http://en.wikipedia.org/wiki/Public_broadcasting

Types of ownership: public service

Types of ownership: independent

An example of an independently owned media outlet is Domino Records which have bands signed such as the last shadow puppets and arctic monkeys. They are funded through their own company.

Advantages of this is that all of the company's generate profits got to the company and not the parent company because most record labels are have a parent company such as sony. A disadvantage they font get the help from parent company's if they start to go down hill.

http://www.theguardian.com/media/independent-production-companies

A conglomerate is a huge corporate company that owns smaller companies, such as SONY, Who own a record label, film company, TV and also sell things such as phones and TVS.

The advantages of this is that is very profitable because you’re generating profit from each company combined a disadvantage is that you can be seen as dominating the media and may be accused of not producing/broadcasting anything that isn’t in your best interest.

http://en.wikipedia.org/wiki/Media_conglomerate

Types of ownership: conglomerate

Horizontal Integration is when two big companies merge together for example when Universal Records and EMI merged together.

The advantages of this is you can generate more profits and publicity a disadvantage is you may lose your independence and the other company might start making your decisions for you.

Types of Companies:Horizontal Integration

Vertical Integration is when a company profits from the production, distribution and consumption of a product for example in the music industry. With all the new software available smaller and smaller companies are able to achieve this.

The advantages of this are you can generate profit from each aspect of making a media product the disadvantages are because smaller and smaller independent companies are able to achieve this now customers to your company may find the cheapest option.

Types of Companies: Vertical Integration

Cross media convergence is when a form of media appears in another form of media for example songs appearing in games. Such as Rockstar Games GTA V has about 50 different songs on the game. The advantages are they can be used to benefit each other in quality and profits.

Cross Media convergence

Synergy is when a media product sells other products such as merchandise, if a band is doing a concert they would sell t-shirts and their album at the concert that is synergy. The advantages are you can make more money because you can sell multiple products at once.

Synergy

The music industry is structured in a pyramid system it starts at the top with the people who are making the product and then goes down to the consumers of the product. There’s multiple aspects of the production such as promotion, production and exporting. Then consumption of the product. Recently promotion has become more and more easy with the likes of YouTube/ Facebook helping smaller and smaller artists get attention. Its usually the actual record company that does most of the more media side and the artist just doing the creative production. Such as Sony records they’ll take care of almost everything apart from the music and they may even have a small input on that. But smaller and smaller record companies have been able to do what the bigger companies do know with recent software that is available.

The main aspects are:Artists and composersManagersProduction companiesPublishing companiesRecord companiesDistributionRetail

Describe the Structure and of Ownership of Either The Film, TV, Gaming or Music Industry

Sony, is a Japanese multinational  publicly owned conglomerate. They have big electronics, gaming, film and music companies. They produce products such as the PS4, Spiderman movies, Sony TV’s and they have artists signed such as Lady Gaga.

Sony

Sony Corporation ,commonly referred to as Sony, is a Japanese multinational conglomerate corporation headquartered in Kōnan Minato, Tokyo, Japan.Its diversified business is primarily focused on the electronics, game, entertainment and financial services sectors. The company is one of the leading manufacturers of electronic products for the consumer and professional markets. Sony is ranked 87th on the 2012 list of Fortune Global 500.Sony found its beginning in the wake of World War II. In 1946, Masaru Ibuka started an electronics shop in a department store building in Tokyo. The company had $530 in capital and a total of eight employees. The next year, he was joined by his colleague, Akio Morita, and they founded a company called Tokyo Tsushin Kogyo (Tokyo Telecommunications Engineering Corporation). The company built Japan's first tape recorder, called the Type-G. In 1958 the company name was changed to Sony.In the early 1950s, Ibuka in the United States heard about Bell Labs' invention of the transistor. He convinced Bell to license the transistor technology to his Japanese company, for use in communications. Ibuka's company made the first commercially successful transistor radios.

Ownership

Sonys mergers and takeovers have allowed it to become a vertically integrated company. Key to this was that they acquire Columbia Pictures Entertainment in 1989. Sony has since created numerous other film production and distribution units, such as Sony Pictures Classics for art- house fare, by forming Columbia TriStar Pictures after merging Columbia Pictures and TriStar Pictures in 1998• The Columbia TriStar Motion Picture Group has a library of more than 4,000 films and as of 2004 this unit of Sony distributes about 22 films a year under its various brands in 67 countries. The group owns studio facilities in the United States, Hong Kong, Madrid, Mexico, the United Kingdom, Brazil and Japan. Columbia TriStar also has a contract to distribute films for independent Revolution Studios and select films by MGM and United Artists.• 2005 – a Sony-led consortium acquired the legendary Hollywood studio Metro-Goldwyn-Mayer (MGM) in a deal worth nearly $5 billion. Again, in an ideal world, the back catalogue releases would be played on Sony equipment. Profits from its major studio successes allow it to back smaller, independent films through “niche” companies like Destination Films, which it purchased in 2001 and Stage 6 Films, a direct to video/DVD label created in 2007. It used to have its own cinema chain in which to exhibit its products; it has Sony Pictures Home Entertainment: manufactures and distributes the Sony film library on Blu-ray Disc (a Sony product) and DVD. It has its own (or co-owned) film distribution companies around the world, so it doesn’t have to look for a distributor abroad It also owns Sony Music Entertainment, formed by successive mergers of various other companies, including Columbia Records, Epic and RCA. Sony completed its acquisition of the German Bertelsmann Music Group on October 1, 2008. The company Sony Music Entertainment Inc. became a wholly owned subsidiary of the Sony Corporation of America.• Artists signed to Sony can be found on Sony produced soundtracks of Sony films, like Spider-Man (2002), for example. If you like Chad Kroeger, you may go out and buy music from his band Nickleback on Road Runner Records, which is owned by Sony, or perhaps you enjoyed Aerosmith on the Spider-Man soundtrack, in which case, you might prefer to buy CDs from their back catalogue, which is owned by Sony.

Sonys main rivals are Universal because they produce some of the same products such as films and music and they are just as big if not bigger than Sony. They make millions of dollars just the same as sony.

They both have problems with illegal downloading however as films, music and games have become widely available and easy to download for free so it is forcing their hand to try and make defences about it or stronger laws.

Competitors

There audience is pretty broad as at least one of their products appeals to any given person but if you had to put a majority on it it would be mainly males of all ages.

It shard to find stats on their audience because they make so many products and its so broad but they make millions of dollars from being so versatile.

Audience

There was a big structure change in January of 1996 and this is what sony said they were changing: The Consumer A&V Products Company will be reorganized to create three new

companies: The Display Company, the Home AV Company and the Personal AV Company.

The Information Technology Company will be newly established to oversee Sony's businesses in the personal computer and IT areas.

In addition, the InfoCom Products Company and the Mobile Electronics Company will be merged to create the Personal & Mobile Communications Company.

The new structure will result in a total of ten companies within Sony Corporation. The other companies not mentioned above are the Components & Peripherals Company (formerly called the Components Company), the Recording Media & Energy Company, the Broadcast Products Company, the Image & Sound Communications Company (formerly called the Business & Industrial Systems Company) and the Semiconductor Company.

In addition to the new company structure, young talent will be appointed as presidents of each company. As in the past, company presidents will be given full autonomy and authority to manage their respective companies.

The Sony BMG CD copy protection rootkit scandal of 2005–2007 concerns deceptive, illegal, and potentially harmful copy protection measures implemented by Sony BMG on about 22 million CDs. When inserted into a computer, the CDs installed one of two pieces of software which provided a form of digital rights management (DRM) by modifying the operating system to interfere with CD copying. Both programs could not be easily uninstalled, and they created vulnerabilities that were exploited by unrelated malware. Sony claims this was unintentional. One of the programs installed even if the user refused its EULA, and it "phoned home" with reports on the user's private listening habits; the other was not mentioned in the EULA at all, contained code from several pieces of open-source software in an apparent infringement of copyright, and configured the operating system to hide the software's existence, leading to both programs being classified as rootkits.

Sony BMG initially denied that the rootkits were harmful. It then released, for one of the programs, an "uninstaller" that only un-hid the program, installed additional software which could not be easily removed, collected an email address from the user, and introduced further security vulnerabilities.

Following public outcry, government investigations, and class-action lawsuits in 2005 and 2006, Sony BMG partially addressed the scandal with consumer settlements, a recall of about 10% of the affected CDs, and the suspension of CD copy protection efforts in early 2007.

www.nasdaq.com/symbol/sne/institutional-holdings www.studymode.com/essays/Vertical-Integration-

At-Sony-162799.html www.universalpictures.co.uk/ www.sony.net/SonyInfo/News/Press_Archive/

199601/96O-004E/ www.networkworld.com/article/2194292/network-

security/sony-bmg-rootkit-scandal--5-years-later.html

Bibliography