Sony has transitioned from primarily producing hardware to also acquiring software companies like music labels. This helped Sony become less dependent on American companies. Sony owns a film studio and distributes films, music, and games. For the Spider-Man film, Sony leveraged synergies across its divisions - the film studio produced the movie, music label produced the soundtrack, and Sony sold games, DVDs, toys, and other merchandise related to the film. Synergies allow companies like Sony to spread costs and risks across industries while increasing profits from each medium. However, synergies are difficult to achieve in practice and can result in job losses or oligopolies forming.

1. Synergy and Convergence Industry Aims of Lesson - To examine synergy within the Sony Corporation To explore the case study of Sony Synergy in Spider-Man To evaluate the importance of Synergy Focus Question: Discuss the importance of cross media convergence and synergy in an industry you have studied.

2. Key Terms Convergence Industry Conglomerate Oligopoly Synergy Vertical Integration Hardware and Software Merger / Joint Venture What are the meanings of these terms? How do they relate to the focus question?

3. Sony’s Transition Hardware Hardware and Software Traditionally Japanese companies like Sony produce hardware (Walkman, VCR). In 1988 Sony bought Columbia Records and acquired software (music catalogue). This advantaged Sony in that it became more independent from American companies. Sony also purchased Columbia/Tri-Star Films, now known as Sony Pictures.

4. Convergence Industry Diagram SONY Film Production Sony Pictures TV hardware Bravia Film Consumption HDTV Blu-ray Music Production Music Consumption Music Distribution Gaming Acid Music Studio 7 Jive Records Complete diagram adding other industries that Sony operates in.

5. Like other big media conglomerates, Sony owns a film studio. However, Sony does not own a broadcast network. But Sony is ahead of the competition in its hardware-software synergy strategy. Although in music consumption and distribution Apple produces hardware (iPod/iPhone/iMac) and software (iTunes).

6. Sony Synergy - Spider-Man Film - Sony Pictures Soundtrack - Sony Music Entertainment Game - Playstation2, PSP DVD - Blu-ray - Joint Venture with Marvel Comics Other Merchandise - toys, clothes, posters all promote the film and benefit Sony financially.

7. Advantages of Synergy Companies like Sony can spread their commercial interests. Diversification means a reduction in risk. Increase profit of each separate medium. Enhances company’s image. Can reach shrinking audiences with diverse tastes . Influence public opinion. Dominant a variety of markets. Sharing skills between two companies and exploiting strengths ( Sony and Marvel, Sony and Ericsson, Sony and 3 Mobile ).

8. Problems with Synergy Easier in theory than in practice. Different companies may have different ideas. Can lead to loss in jobs. Sony has laid off 19,500 workers this year. Merging together to exploit strengths or sharing risk? Smaller companies who only specialise in one medium struggle to compete. Leads to oligopolies - uneven distribution of power.