Vertical integration in the music industry refers to a company owning different parts of the production and distribution process, such as a recording studio, talent agency, and distribution company. This allows them to profit from every stage. Horizontal integration means a company owns different types of media, such as movie studios, music labels, and radio stations, concentrating ownership across industries. Both vertical and horizontal integration can benefit companies by increasing control over the process and enabling synergies across business units.

1. Vertical & Horizontal
Integration
In the Music Industry

2. Owning the stages of production and distribution.
Vertical integration: An ownership structure in which one
conglomerate owns or operates all aspects of production and
distribution within a single segment of the media industry; for example,
production studio, talent agency, Online distribution company, CD
manufacturing plant rental stores.
What are the benefits of being vertically integrated?

3. Media Conglomerate
Factory
High Street Shop
Distribution Channels
Recording Studio
Content Producers
VERTICALINTEGRATION

4. Owning a range of companies at the same production level.
Horizontal Integration: An ownership structure in which one
conglomerate owns or operates different kinds of media (for example,
movie studios, television networks, music labels and radio stations),
concentrating ownership across the different segments of the media
industry.
What benefits arise from being horizontally integrated?

5. Horizontal Integration Examples
Owning different types of media.

6. Research and add to Case Study
• What subsidiary labels does your conglomerate own?
• How does your label use the internet?
• Considering the portfolio of labels and the artists signed to them, is there
any evidence of the long tail?
• How is your label horizontally integrated?
• How do they use this to their benefit? (refer to specific examples)
• How is your label vertically integrated? ( how do they profit from the
different stages of music production, distribution and consumption)
• What is synergy? Are there any examples of your conglomerate using it?
• What are your conglomerate’s current strategies to combat piracy?