2. BTEC ExtendedDiplomainCreativeMediaProduction
Understand the structure and ownership of the creative media sector
Use this workbook to help you with this learning outcome. There is some guidance
and further notes, which you should read and then remove, replacing it with your
own answers.
Provide a definition of the following different types of ownership and
provide an example of a company, which is owned in such a way.
Private ownership is a company that is owned by people /shareholders who are
private citizens rather than being owned by the government.
Public service broadcasting is for a company who’s content isn’t purely for
commercial benefit. An example of this would be the BBC. Sate owned means
that the government owns it.
Multinationals are large companies, which operate in many different countries.
Larger companies nearly always fund them. An example of this would be Rockstar
games, as they own many smaller companies in other countries.
Independents are independent media that is free from the influence of the
government or corporate interests.
Conglomerates are combinations of two or more corporations engaged in entirely
different businesses that fall under one corporate group.
Voluntary or not for profit organisations work to affect social change. Their main
aim Is to make money but all money made is contributed towards there work. For
example ‘Accessible arts and media’ witch helps people with disability’s produce
there own media.
3. BTEC ExtendedDiplomainCreativeMediaProduction
What are some of the challenges faced by independent media companies?
They may not have the funds for a big budget production.
What are some of the challenges faced by multinational media companies?
They will have to adjust their business to suit the laws in all country’s
What is cross media ownership?
Cross media ownership is when an organisation owns more than one type of
media company, for example a radio show and a newspaper (kerrang!).
What is diversification?
Diversification is a major media company’s spread into ownership of other related
and unrelated products. For example, virgin started as a music distributer and
then expanded into a record label, radio empire, mobile phone provider and more.
What is horizontal integration?
Organisations that own more than one company at the same level of production.
What is vertical integration?
4. BTEC ExtendedDiplomainCreativeMediaProduction
Organisations that own companies at different levels of production.
What are some of the advantages of these different ways of structuring a
company?
Increased profits for parent company. Increasing market share.
Use the following table to show how the Disney Company is structured.
Production Pixar Marvel Walt Disney
studios
Distribution Buena vista
home
entertainment
Marvel
television
Disney media
Screening Hollywood
pictures
Marvel
entertainment
Walt Disney
cinema
What different ways can ownership be shared out?
Shareholders can choose to invest money into multiple different companies
What is a merger? Why would companies merge together?
A merger involves both organisations deciding together to merge. It is done to
help cut costs and increase profits.
What is a takeover? Why do companies take each other over?
5. BTEC ExtendedDiplomainCreativeMediaProduction
A takeover is when a company purchases a smaller company. This can produce
the same benefits as a merger, but isn’t always a mutual decision.
What is cross media regulation?
Cross media regulation decides who can own what across different forms of
media.
Should we have restrictions on the amount of media outlets people can
own?
I think that there should be restrictions on the amount of media outlets people can
own so therefore one person cannot own an unfair amount of media outlets.
You should select an organisation to work with to help you answer the following
questions. It can be in any media sector. Researching your company in detail will
help you produce stronger answers.
What income streams does your chosen company have?
Direct selling of product such as video games, films, newspapers and magazines.
Sponsorship and advertising within a product. This could be magazine or
newspaper advertising, product placement in films and TV programmes and also
in video games.
What is product diversity? How diverse is your company’s product range?
Product diversity is about how many different types of thing you produce. Small
companies have little diversity and produce a small range of things.
6. BTEC ExtendedDiplomainCreativeMediaProduction
What advantages does this give your company in the market place?
Product diversity makes the company have a wider and more understanding of
the market.
Why is the profitability of a product range so important to a company?
Its important because the company will need to be able to afford to bring new
products out.
What advantages or disadvantages are there in making big budget,
mainstream products?
Advantage – Gives you control over your money.
Disadvantage - It something goes wrong you risk losing a lot of money.
What are the advantages/disadvantages of taking part in a media
franchise?
An advantage would be that they could make more money (5% more). If they
sold a Hannah Montana toy Disney would receive money as well. McDonalds is
an example of this as they can allow the use of their assets for a cost. This is
good for smaller companies as they could be potentially making a larger profit.
A disadvantage would be that It could easily ruin a company.
What, if any, products do your company license?
ESPN, Lucasfilm, Marvel entertainment.
7. BTEC ExtendedDiplomainCreativeMediaProduction
Who is in competition with your company? How successful is your
company in comparison?
Disney is in competition with 21st century fox. Disney is considered to be more
successful than 21st century fox in many different aspects.
Who are your customers?
The customers are mainly for a younger age of people between the ages of 6+.
The products sold are designed to entertain kids.
Which global media trends are affecting your company right now?
