Ownership in Television

The big companies in my sector include Comcast, Disney, TimeWarner, DirecTV

and Sky (source: http://www.forbes.com/pictures/eimi45gdej/no-10-british-skybroadc/). An example of a privately owned company in this sector is MTV. MTV
was the first TV station that brought music videos to television, it is owned by
Viacom Media Network. Viacom Media Network is a division of media
conglomerate Viacom. MTV creates content for the target audience of people
between 16 to 24 years old, some of the programs that MTV shows is Celebrity
news, music videos and reality shows. These shows result in MTV being quite a
successful station with 32 million viewers, 8.5 watching at least an hour a day.
MTV is just one of Viacoms channels and this shows us how large Viacom really
is. In 2003 it had over $26.6 billion in sales and over 122,770 employees. Viacom
also own other T.V shows such as Nickelodeon, Comedy Central and CMT.
Although Viacoms presence in the T.V industry is strong they have also
expanded into other areas of media. These areas include Film (owning
Paramount Pictures and many other production and distribution companies),
Internet (BET.com and others) and Record labels (Nick Records and Comedy
Central Records). This is called cross-media ownership, a large company that is
able to expand into other media areas. An advantage to this is that it reduces
costs as big companies have more purchasing power and can produce products
at a reduced cost. Cross-media ownership is regulated by Ofcom who make sure
that there is not one dominating giant in the media industry. They make sure that
it is still possible for small companies to grow in the media sector. Cross media
helps making the product diverse by allowing pools of resources to produce more
at less cost. With all the resources from different sectors of media, it allows a
huge amount of options when creating products. An example of a company being
diverse in the media industry can be seen with Disney. Disney has moved to
many different areas of media, from movies to amusement parks and all this
helps Disney with marketing power. Cross media also helps with growing an
audience. This is because expanding a company to a new sector allows you to
reach a new audience. It also makes the brand of your company more common
and therefore more likely for people to see it. It also allows your original
consumers to buy more of what you are creating. Furthermore cross media also
helps companies financially. This is due to the fact that wider distribution is
possible, allowing a higher amount of distribution as well as distributing to a
larger audience, meaning a greater profit. Furthermore it provides business
security because if one market fails the company can still focus on another. A
great example of this is Sony. Cross media also allows ownership also allows big
companies to produce products at a lower price. This can be backed up by
Disneys profit figures coming in at around 12.8 billion dollars, the highest in the
companys history.
Independent Companies
An example of an independent TV production company is ITV. ITV is very
successful coming in with a $648 million profit in 2014. Compared to the private
company Viacom with a $610 million profit in 2014. This shows that in this case
an independent company can make more than a private company in the TV
industry. The type of content ITV produce is programmes such as The Jeremy

Kyle Show and The Chase. There is a real mix of content produced by ITV as
they have different ITV channels, such as itv and itv 2. Independent
companies are free from outside control form things such as the public or
government. An independent company on TV makes its money from adverts inbetween the programmes. The organisational objective of an independent
company such as ITV is to make money and to entertain their viewers so that
they come back to watch the programmes.
The Sources of income
The Sources of income for companies in the TV industry depends on whether or
not you are independent or public owned. If you are public owned then your
source of income comes from the government or the public. However if you are
an independent TV company then you make your money from the adverts that
play in between your programs.
An example of a company in the TV industry getting its income from the public is
the BBC as they are not independently owned. This can be shown as on the BBC
channels there are no adverts. However an example of a company in the TV
industry getting its income from adverts are channels such as channel 4 as they
are independently owned.
Merges and takeovers
Merges and take overs are things that are quite common in the TV industry.
Merging is when two companies come together to work/collaborate together. An
example of this is Disney and Pixar merge in 2006 which allowed the two
companies to collaborate freely with each other. This allowed them to bring their
ideas and movie titles together and work as a team on further projects which
helped diversify future films. Some advantages to a merge is as the following. It
can lower the average cost of products meaning that consumers can have lower
costs which puts you over competitors or allows you to have a larger profit
margin. Furthermore it can bring diversity which is something very important in a
creative sector such as TV. A takeover is when one company takesover another
company, this is usually done by buying out the owners. This means that the
company pays a set amount of money to take company under their companys
control. The advantages to this is that it can result in international growth if you
buy companies in different parts of the world. Furthermore it overall helps with
the expansion of a company which can be very useful in the TV industry as there
is so much competition and the bigger you are the more likely people are to
watch. An example of this happening was when Google took over YouTube. This
allowed google to expand from just word searches to video searches. Merging
and takeovers are known as external growth as they do not happen within the
original company.
Competition
With the TV sector being the source of a large amount of revenue that only
comes if you are watched, it does spark up a lot of competition. This is not
surprising because a channel is only successful if it is watched, there are a
limited amount of viewers and therefore you need to be better than other
channels in order to not lose or gain viewers. Competition is most likely at the
highest level with independent channels. This is because they are paid with the
adverts that play in-between the programs they produce. The more popular the

show the more money, therefore they need to have better shows then other
channels in order to get paid a greater amount. Competition is not only between
channels but also TV providers such as SKY and Virgin. I believe that competition
is a good thing in the TV industry. I say this because it helps creativity as to
create something new will give you an edge over your competitors. It also means
that you will get things for a lower price as you have to beat your competitors
price. Overall I believe it helps keep the TV industry fair for the consumer and
also keeps it fresh production wise. An example of competitors would be Channel
4 and E4 as they have a similar viewer target and therefore are fighting to get
those viewers from eachother.
Licencing and Franchising
Licencing and Franchising is a big thing in the media industry, especially with big
companies such as Disney. A group makes about 120m a year from licensing its
brand to other companies, this shows how import licensing and franchising is in
the media industry. Licencing and Franchising are two ways through which the
owner of a small company/company can grow their business. Licencing is a
contract though which one company grants another permission to use its
patents, trademarks, copyrights, design or trade secrets. The licence is gained
by a flat fee, royalties or both. Franchising gives permission to not just use the
things involved in licencing but also franchisors distribution systems and
marketing campaigns to sell the franchisors products or service. A great
example of a company that does licencing and Franchising is Disney with its toys
and over all brand.
If a larger company such as Disney allow Licencing and franchising that means
that a smaller company can buy the property of that larger company, including
the trade market and the availability to sell their product (a certain amount of
profits go to Disney). If a small company bought the Licensing and Franchising of
Disney that would allow them to sell Disney products using the Disney brand.
This helps small businesses gain a greater income as they can use the popularity
of a bigger company and also allows the large company to make money without
having to do much.
Customers
Customers are something all companies in the TV industry have to think about.
This means marketing programs, channels the correct way to go with the target
audience you want to attract. An example of this is Disney, their target audience
is young children and therefore their marketing campaign is targeted towards
children and their parents. They also target at parents because the parents are
the ones with money (Disney advert as example
https://www.youtube.com/watch?v=T8DLyA315mU). In this advert Disney is
shown as a fun place for kids as it shows multiple kids excited reactions as they
are told they are going to Disney land. It is also marketed to the parents as the
advert shows scenes of the kids hugging their parents. Also parents want to
make their kids happy and this advert show them how they can do that.
Furthermore we can see Disney expanding its brand with its customers in mind.
They have catalysed on their young audience by creating toys and theme parks
that cater to them. Without customers companies in the TV industry will fail, they
are needed for expanding companies, making companies more popular and
keeping a company profitable. Young children are one of the best customers to

market to because they are more easily manipulated as many do not understand
that advertisements may be misleading. However a down side to having a
young audience as your target consumer is that they do not have much if any
money for themselves. This is why you see many child aimed companies such as
Disney marketing towards the parents as well as they are the ones with the
money.
Product diversity
Product diversity is when a company has a wide verity of different products. In
the TV industry product diversity could be seen in independent companies such
as ITV that has wide verity of programs on their different channels. Product
diversity is good for a channel as it allows them to gain a wider audience as they
have different types of products/programs for different types of people. This
helps make the companies brand more popular which is important in the TV
industry as a popular channel will help bring more viewers. However there can
be a down side to product diversity in the TV industry, this being that if you have
too much of a wide verity of programs on singles channels such as the BBC you
may not get many viewers. This is because people may only like one show on the
channel and not like the others as they are too different and therefore it is not
worth for them to come back to the channel. Overall product diversity in the TV
industry can be a good thing however too much diversity on one channel can be
problematic.
Organisational objectives
Organisational objectives for companies in the TV industry are different and can
vary from channel to channel. The definition of organisational objects is a goal,
mission and purpose of a business that have been established by the manager
and communicated to the employees. It is the long range intentions for operating
the company and is often used as guidance for new strategies made. An
organisational objective for many companies in the TV sector is to make money,
and this can mean trying to get more viewers or better paying advertisers.
Another objective for many is to entertain, majority of TV channels are made to
entertain the public, examples of this being SKY 1. We know this channel
organisational objective is to entertain because it airs comedy shows such as
The Simpsons and different Dramas such as You Me and the Apocalypse.
Other channels such as BBC News are made to inform, most TV channels have
just one organisational objective. This is because each TV channel is targeted at
different type of people (target audiences). Furthermore the BBC is also made to
provide entertainment that the majority of the public can enjoy
National and Global Competition
With the advancements in internet speeds and digital TV, smaller companies are
able to compete with much larger companies that are on the other side of the
world. This means that it is harder for companies to establish themselves or keep
their consumer base as more popular companies can compete from the other
side of the world. This means that there is greater competition and for smaller
companies it can be very difficult to grow as there is just so many other more
known options for consumers. This has led to smaller companies having to be
very unique as they cannot compete with the larger more popular companies.
They cannot compete because the larger more popular companies have bigger

budgets, man power and a larger consumer base. Trends are a great way for
small businesses to grow, this is because if you can come up with the next big
trend that the large companies are not following then you do not have to
compete with them. An example of this in the TV industry is that a current trend
is superhero shows. The major channels are already pumping out superhero
shows e.g. Green Arrow and Flash. They have already established a large
audience and as a new channel it would be hard to compete with them. However
if they come up with the new trend then they dont have to compete and if the
trend is popular they will grow from it.

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