Intro Media Institutions
• PBS or Murdoch?
• PBS – BBC, PBS America etc
What Makes Up The Media Industries?
Broadcasting
New Media
Press
Cinema
Advertising
Who owns this?
• AOL – Time Warner
This?
News Int (News Corp)
This?
Also News Corp
How about this?
GE NBC Universal!
This one for a prize!
Viacom!
This?
• Gerald Levin, chief executive, AOL Time Warner , in a CNN
discussion on the future of the media, a few days before the
AOL Time Warner merger, predicted global media would
become the dominant industry of the 21st century — so
powerful that they might in fact become more powerful than
governments. "So what's going to be necessary is that we're
going to need to have corporations redefined as instruments of
public service," he said, adding: "It's going to be forced anyhow
because when you have a system that is constantly available
everywhere in the world immediately, then the old-fashioned
regulatory system has to give way."
Media Studies
• Media Concept
Institutions
• Medium Examined
Mass Media
• Topic
Media Giants
Key Question
• Is media a business
whose texts and products
are to be sold to the
consumers?
• Is media a public service,
in which the emphasis is
to inform, educate and
entertain the people?
Public or Private Control?
Who will control those who control those who
control?
A Watchdog
• Traditionally, the role of
the media is to safeguard
citizens’ rights by
ensuring that public
servants, including those
who govern, are
accountable to the
people. It is the ‘fourth
estate’ of government.
What about this convergence thing?
What are the types of convergence?
• Industry structure - Incentives for Global Markets,
changes in customer demands require changes in
revenue models
• Content – design process, production process,
distribution process.
• Technology – hybrid devices to use multiple formats
– the bit that Andreas is teaching.
REGULATION: Press
• Self Regulation
– Voluntary code - PCC
– www.pcc.org.uk
• Legal control
– Libel
– Jeopardize State Security – Diana/Dodi trial MI5 in secret.
– ‘Prejudice a Fair Trial’
• Campaign for Press & Broadcasting Freedom
– www.cpbf.org.uk
Media as the ‘fourth estate’
• Parliament debates
government policy and
makes laws
• The Executive makes and
execute policy runs the
government
• The Judiciary interprets and
clarifies the law
• Media - a free press can
report all government activity
Liberal notions of the media
• Rooted in the freedom of
the press and the neutrality
of the market.
• Plays a vital role in
democracy;
• Media informs the
electorate,
• Checks and critiques
government;
• Articulates public opinion.
Radical Theory
• Media is profit motivated
• It generates content that
garners the greatest profit.
• It tells what sells.
• It is geared to readership
and audience tastes and
prejudices.
• It cannot be unbiased or
objective.
The Media Giants
Media Giants
• Bertelsman AG (Random House,
BMG, Internet)
• News Corp (Murdoch, Fox,
Star TV, newspapers, Dodgers)
• Viacom (Paramount, Blockbuster,
MTV, CBS)
• Vivendi/Universal (Music, studios,
European media)
• AOL/Time Warner (Books,
magazines, movies)
• Disney (ABC, Touchstone, sports,
publishing)
Convergence
• Corporations own a
variety of media outlets
• TV, radio, movies, books,
magazines newspapers,
Internet
Media Monopolies
• .
Media ownership – the shrinking
• The rise of media conglomerates can be traced back to
the 1980s & 1990s which saw a lot of mergers and
buyouts of media and entertainment companies.
• Bagdikian, a media scholar who studied this
phenomenon noted that the last twenty years witnessed
a trend where the ownership of the media industry was
increasingly concentrated in the hands of a few
companies. For example, in 1983
• fifty corporations dominated most of every
mass medium and the biggest media merger
in history was a $340 million deal. ... [I]n
1987, the fifty companies had shrunk to
twenty-nine. ... [I]n 1990, the twenty-nine had
shrunk to twenty three. ... [I]n 1997, the
biggest firms numbered ten and involved the
$19 billion Disney-ABC deal, at the time the
biggest media merger ever. ... [In 2000] AOL
Time Warner's $350 billion merged
corporation [was] more than 1,000 times
larger [than the biggest deal of 1983].
Six Corporations own 90% of the U.S. media (newspapers, magazines, TV
and radio stations, books, records, movies, videos, wire services, photo
agencies, and the Internet
Research tool
Who owns what
The following information was found at
http://www.pbs.org/wgbh/pages/frontline/shows/cool/giants/
Links between the Media Giants
Bertelsmann/Sony Corporation
• Japan-based Sony Corporation started in 1946
as Tokyo Telecommunications Engineering, with
three employees. Now, it boasts more than
180,000 employees worldwide and over $58
billion in sales for 2001.
• BOOKS
United States
Random House; Ballantine; Fodor's; Knopf; Modern Library
• Book Clubs: Book-of-the-Month Club; Doubleday Book Club;
Bookspan (50 percent)
• Canada
Random House of Canada; Quebec Loisirs Book Club
• U.K.
Random House; Book CLUB BCA (U.K.); European Book
Clubs; Bertelsmann Media (Switzerland); Circulo de Lectores
(Spain); Circulo de Leitores (Portugal); Donauland (Austria); ECI
(Netherlands); France Loisirs (France); Swiat Ksiazki (Poland)
•
•
•
•
•
•
•
•
•
•
Sudamericana
Pacific
Random House Australia; Random House New Zealand
Germany
Berlin Verlag; C. Bertelsmann Springer Verlag; and 15 other imprints covering all aspects of book publishing;
Book Club Der Club
Online book sales
Barnes&Noble.com (40 percent); BOL
TELEVISION /RADIO
CLT-UFA (merger of Audiofina, CLY-UFA and Pearson Television)
Television Stations:
Germany
RTL; RTL-2 (34.5 percent); SUPER RTL (50 percent, with Disney); Premiere World (5 percent, with
KirchPayTV); VOX (joint venture with News Corporation)
England
Channel 5
France
FUN TV; M6; Multivision Teva
Netherlands
RTL-4; RTL-5; RTL-9; RTL-Tele Letzebuerg
Hungary
RTL Klub
•
•
•
•
•
•
•
•
Hungary
RTL Klub
Television Production:
UFA Film and Television Production; Trebitsch Production; Delux Productions (Luxembourg);
Cinevideo (Canada); Holland Media House (Netherlands); Pearson TV (U.K.); UFA Sports
Radio:
France
Radio RTL; RTL 2; Fun Radio
Germany
Antenne Bayern; 104.6 RTL; Radio Hamburg; Radio NRW; RTL Radio
Belgium
Bel RTL
Sweden
104.7 RTL; Wow 105.5
U.K.
Atlantic 252
"With 22 television stations and 18 radio stations in ten countries, RTL Group is Europe's biggest
broadcasting corporation."
• — www.bertelsmann.com/tv
• MAGAZINES
Gruner Jahr is Bertelsmann's magazine division, publishing 80
magazines worldwide.
• USA
American Homestyle; Family Circle Inc.; McCalls; Parents
• France
Femme; National Geographic and 13 other magazines
• Germany
Stern; TV Today; Impulse Brigitte; and 17 other magazines
• U.K.
Best; Prima; Focus - and this is just the tip of the iceberg!!!
Just the one book company…
• "Today, Bertelsmann is the world's largest
publisher. Our U.S. publishing group Random
House alone ships over one million books a
day."
— www.bertelsmann.com/book
• The Sony Bit of Sony BMG ----
Film
•Sony Pictures Entertainment
•Columbia TriStar
•Sony Pictures Classics
•Screen Gems
Television
•Sony Pictures Television
•AXN
•Animax Japan
•SoapCity
•GAME SHOW NETWORK (50%
with Liberty Media)
•Movielink (jointly owned
with Paramount Pictures,
Sony Pictures
Entertainment, Universal
Studios and Warner Bros.
Studios)
Music
•Sony BMG Music
Entertainment (50% with
Bertelsmann)
Labels include: Arista
Records, BMG Classics,
BMG Heritage, BMG
International Companies,
Columbia Records, Epic
Records, J Records, Jive
Records, LaFace Records,
Legacy Recordings, RCA
Records,
• RCA Victor Group, RLG Nashville, Sony Classical, Sony
Music International, Sony Music
Nashville, Sony Wonder, So So
Def Records, Verity Records
• Sony/ATV Music Publishing (joint
venture with Michael Jackson)
• Music Choice (venture with Time
Warner, EMI, Motorola, Microsoft,
and several cable companies: Cox,
Comcast, Adelphia, Time Warner
Cable)
Other
• Sony Electronics
• Sony Computer Entertainment
America
• PlayStation
• 989 Sports
• Sony Connect Inc.
• Metreon
Walt Disney Co
• The Walt Disney Company is the third largest global
media conglomerate. Its 2000 revenues topped $25
billion, with 27% derived from parks and resorts, 24%
from studio entertainment, and 17% from media
networks.
Walt Disney Company
• Television
Revenues: $25.4 Billion
• ABC, Disney Channel; Toon Disney; Soap Net; ESPN, ESPN2, Lifetime and Lifetime Movie
Network; Disney and ESPN channels in more than 140 countries; Production including Buena
Vista, Touchstone, Walt Disney, ABC Entertainment
• Magazines
• US Weekly, Discover, Family Fun, Disney Adventures, ESPN The Magazine, Talk
• Books
• Hyperion, Talk Miramax, Disney Children’s Book Group, ESPN Books, ABC Daytime Press
• Resorts
• Disney World, Disneyland, Disney Cruise Line, Disney Vacation Club, Tokyo Disney, Disneyland
Paris, Hong Kong Disneyland, ESPN Zone
• Movies
• Walt Disney Pictures, Touchstone Pictures, Hollywood Pictures, Miramax Film Corp.,
Dimension, Buena Vista International
• Other
• 50 radio stations; ABC Radio Network; Radio Disney; ESPN Radio
• Sports teams: Mighty Ducks, Anaheim Angels
• Theatrical productions of Beauty and the Beast, The Lion King, The Hunchback of Notre Dame, and
Aida; 741 stores and Disney catalog
• Licenses characters for clothes, toys, etc. and for teaching aids; videos/films for schools; stakes in
sites including NFL.com and Movies.com; markets cell art from Disney animated films; owns
Celebration, FL (a 4,900-acre town)
Little old ESPN (Disney)
• "ESPN International dominates televised sport,
broadcasting on a 24-hour basis in 21 languages to over
165 countries. It reaches the one desirable audience that
had eluded Disney in the past: young, single, middleclass men. 'Our plan is to think globally but to
customize locally,' states the senior vice president of
ESPN International in Latin America. The emphasis is
on soccer; in Asia it is table tennis; and in India ESPN
provided over 1,000 hours of cricket in 1995."
— Robert W. McChesney, "The Global Media Giants"
in Extra!, November/December, 1997
Disney and Pixar
AOL Time Warner
The Big One
• In January 2001, the $165 billion mega-merger between AOL and Time
Warner was the largest media merger in history.
• The new company promised integrated communication, media and
entertainment across all platforms.
• But shares of the company fell off sharply in the two years following the
merger.
• Heading into 2003, U.S. Justice Department has opened inquiries into AOL's
accounting practices prior to the 2001 merger.
• Employing an estimated 84,900 employees, AOL
Timer-Warner earned USD 43.7 billion in 2005.
• As can be observed, this media conglomerate
owned different media businesses which
operates worldwide.
AOL / Time Warner
Revenues: $36.2 Billion
•
Television and Cable
• WB, HBO and Cinemax, Comedy Central, Court TV, E! and Style, TBS, TNT, Cartoon Network, Turner
Classic Movies, CNN, Headline News; Second largest provider of cable
•
Movies
• Warner Brothers, New Line, Fine Line, MGM, RKO, Warner Home Video, UCI, WF Cinema, Castle Rock
•
Music
• Warner Bros, Atlantic, Elektra, London-Sire, Rhino Records, majority interest in Alternative Distribution
Alliance, Quincy Jones Entertainment, Warner/Chappell
•
Books
• Warner Books, Little, Brown, Time-Life Books, Book-of-the-Month Club
•
Internet
• America Online, CompuServe, Netscape, ICQ, aol Instant Messenger; websites include MusicNet, EMI,
RealNetworks, Mapquest, Winamp, RoadRunner cable
•
Magazines
• More than 64 magazines including the 3 best selling: Time, Life, and People; Fortune, Sports Illustrated, DC Comics;
IPC (leading in Britain)
•
Other
• Sports teams including Atlanta Braves, Atlanta Hawks, Atlanta Thrashers, Goodwill Games, Phillips Arena;
Warner Bros. Movie World Theme Park, Time Warner Telecom, Warner Bros. Studio Stores, DC Comics,
Hanna Barbera characters, WB properties
“AOL Everywhere”
• Cable Broadband
– Potential to solve AOL’s broadband
strategy
– Powerful means to deliver content
• Publishing Industry
– Brand extension opportunities: Online
sites
• Music Industry
– Potentially huge market for music
downloads
• Cable Industry
– AOL TV: capitalize on our TV habit
– Platform for other media devices
• Film Industry
– Promotion: movie clips, plot tests
– Interactive HDTV
AOL / Time Warner
Revenues: $36.2 Billion
•
Television and Cable
• WB, HBO and Cinemax, Comedy Central, Court TV, E! and Style, TBS, TNT, Cartoon Network, Turner
Classic Movies, CNN, Headline News; Second largest provider of cable
•
Movies
• Warner Brothers, New Line, Fine Line, MGM, RKO, Warner Home Video, UCI, WF Cinema, Castle Rock
•
Music
• Warner Bros, Atlantic, Elektra, London-Sire, Rhino Records, majority interest in Alternative Distribution
Alliance, Quincy Jones Entertainment, Warner/Chappell
•
Books
• Warner Books, Little, Brown, Time-Life Books, Book-of-the-Month Club
•
Internet
• America Online, CompuServe, Netscape, ICQ, aol Instant Messenger; websites include MusicNet, EMI,
RealNetworks, Mapquest, Winamp, RoadRunner cable
•
Magazines
• More than 64 magazines including the 3 best selling: Time, Life, and People; Fortune, Sports Illustrated, DC Comics;
IPC (leading in Britain)
•
Other
• Sports teams including Atlanta Braves, Atlanta Hawks, Atlanta Thrashers, Goodwill Games, Phillips Arena;
Warner Bros. Movie World Theme Park, Time Warner Telecom, Warner Bros. Studio Stores, DC Comics,
Hanna Barbera characters, WB properties
Vivendi Universal (Also known as
GE NBC Universal)
• Created in December. A merger combined Vivendi's telecommunications
assets with Universal Studios and Canal+'s programming and broadcast
capacity.
• Vivendi Universal's subsidiary Universal Music Group is the world's top
music company, with roughly 22% of the global market share in 1999.
• Heading into 2003, the company plans to sell off $16 billion in assets
because of massive debts.
Vivendi Universal
• USA Network, Sci-Fi Channel; Universal Studios;
Leading French publisher; Houghton Mifflin
publishers, medical & reference books and CDs;
27% of US music sales: Interscope, Geffen, A&M,
Island, Def Jam, MCA, Mercury, Motown,
Universal; Universal Studios, StudioCanal,
PolyGram Films, Gramercy; info technology and
medical journals; theme parks (Universal Studios &
SEGA Game Works), stores inc. Spencer Gifts;
Second largest private water rights owner in the
world; 151 recycling facilities, 119 landfill sites, 83
incineration plants worldwide
• June 14, 2000 Announcement that Vivendi and Seagram in
merger talks. It was reported as one more global media merger,
creating a $55 billion group, Europe's version of AOL Time
Warner.
• October, 2000 Mario Monti, EU Competition Commissioner,
clears merger. Terms include selling Vivendi's stake in BSkyB and
making Universal's library available to rival media groups on fair
terms. Company to also sell 55 percent held in ISP AOL France.
After Seagram and Canal Plus shareholders agreed on merger,
Vivendi Universal began trading on December 11, 2000. A
month later shares in the company had fallen by 12 percent.
Just the tv and film bits…
• TELEVISION and FILM
Canal 14 million subscriptions to pay-TV in 11 European
countries. Main companies include CanalSatellite; StudioCanal;
Canal ; Spain Telepiu; Canal Digital.
• Universal Studios; Universal Pictures; Universal Studios Home
Video; Universal Television & Networks Group (4,000 film titles,
24,000 television episodes of such series as "Kojak," "Miami
Vice," "Columbo"). Several theme channels, including SciFi
(U.K.) Action and Suspense Channel; 13ème Rue; USA Network.
• Distribution
Cineplex Odeon Corporation (42 percent)
Cinema International Corporation (49 percent)
United Cinemaa International (49 percent)
General Electric
Revenues: $129.9 Billion
• Television
• NBC, CNBC, MSNBC, A&E, History and Biography channels (shared), Snap TV, AMC,
Bravo, WE, and Independent Film Channel; regional news, sports, and entertainment
channels; Canal de Noticias NBC and TV Azteca; Production including NBC Productions,
Radio City Television, Bravo Original Programming, IFC Productions, Next Wave Films,
Satellite DBS Provider
• Internet
• Snap, NBC.com, CNBC.com, Salon.com, polo.com
• Other
•
•
•
•
•
Ammonia plants, Nuclear reactors
Aircraft engines; GE, Hotpoint & other appliances; light bulbs
14 communications satellites, cars, computers
MR and CT scanners, X-ray and ultrasound machines
Health, accident, and long term care insurance; investment and retirement plans; mortgages,
home equity and commercial real estate loans, car loans,
• Credit card application processing, sales authorization, and collection services for retailers in
23 countries
• Owns stock in retail, financial services, telecommunications, healthcare, food and beverages,
cable and broadcasting industries; leases 1,000 aircraft, 190,000 railcars, and about 1 million
cars, trucks, and tractor trailers
Viacom, Inc.
• Television
Revenues: $20 Billion
• CBS, UPN, MTV, MTV2, VH1, Showtime, Nickelodeon, Noggin, Nickelodeon GAS, TV Land,
Comedy Central, TNN, CMT, The Movie Channel, Sundance Channel, FLIX, BET
• Movies
• Paramount Pictures, Nickelodeon Movies, MTV Films, BET Arabesque Films; Blockbuster; about
1,800 screens in theaters in the US, Canada, Europe, Asia, and South America
• Books
• Simon and Schuster, Pocket Books, Scribner, The Free Press, Arabesque Books; divisions in Britain
and Australia
• Internet
• MTV.com, VH1.com, Nickelodeon Online, stakes in iWon, Sportsline.com, MarketWatch.com,
hollywood.com
• Music
• 184 Infinity radio stations; CBS Radio Network; Westwood One, Sportsline Radio; Famous Music
holds copyright to more than 100,000 musical works
• Other
• Paramount theme parks in US and Canada including Star Trek, The Experience, House of Blues,
theme restaurants, World Wrestling Federation Entertainment
• Exclusive advertising rights on buses, subways, trains, kiosks, billboards, and other venues in New
York, L.A., Chicago, San Francisco, Philadelphia, Detroit, Houston, Atlanta, and 82 other US cities
and cities in Mexico, Canada, Britain, Ireland, and throughout Europe
Viacom, Inc.
• Television
Revenues: $20 Billion
• CBS, UPN, MTV, MTV2, VH1, Showtime, Nickelodeon, Noggin, Nickelodeon GAS, TV Land,
Comedy Central, TNN, CMT, The Movie Channel, Sundance Channel, FLIX, BET
• Movies
• Paramount Pictures, Nickelodeon Movies, MTV Films, BET Arabesque Films; Blockbuster; about
1,800 screens in theaters in the US, Canada, Europe, Asia, and South America
• Books
• Simon and Schuster, Pocket Books, Scribner, The Free Press, Arabesque Books; divisions in Britain
and Australia
• Internet
• MTV.com, VH1.com, Nickelodeon Online, stakes in iWon, Sportsline.com, MarketWatch.com,
hollywood.com
• Music
• 184 Infinity radio stations; CBS Radio Network; Westwood One, Sportsline Radio; Famous Music
holds copyright to more than 100,000 musical works
• Other
• Paramount theme parks in US and Canada including Star Trek, The Experience, House of Blues,
theme restaurants, World Wrestling Federation Entertainment
• Exclusive advertising rights on buses, subways, trains, kiosks, billboards, and other venues in New
York, L.A., Chicago, San Francisco, Philadelphia, Detroit, Houston, Atlanta, and 82 other US cities
and cities in Mexico, Canada, Britain, Ireland, and throughout Europe
Vertical Integration as Basic
Characteristics of
Media Conglomerates
The Profit Motive
• Essentially, all activities of the media industry centered
around the creation and packaging of intellectual
property with the aim of maximizing revenues by
selling it as many times as is feasible to the widest
audience.
• Given its aim of revenue maximization, the media
industry have focused on the vertical integration
business strategy.
What is Vertical Integration
• This term describes a style of ownership and
control where a group of companies are united
through a hierarchy and share a common owner
where each member of the hierarchy produces a
different product or service, and the products
combine to satisfy a common need.
• The idea behind vertical integration is that all
activities of an industry are ordered in a
sequence which starts ‘upstream’ at the early
stages in the production process, works its
way through succeeding or ‘downstream’
stages where the product is processed and
refined, and finishes up as it is supplied or
sold to the customer.
• Also known as vertical supply chain.
Production:
creating media
content
Packaging: content is
collected together &
assembled as media product
The Media Supply Chain
Distribution:
delivering
Product to
customers
News Corporation
• Rupert Murdoch's News Corporation Ltd. Has media holdings in the U.S.,
Canada, Europe, Australia, Latin America and Asia.
• As of September 30, 2000, its assets totaled $38 billion and total annual
revenues approximate $14 billion.
• In 2003, the company is seeking to acquire DirectTV, a U.S. satellite tv
company.
Vertical Integration?
News Corporation (Murdoch)
Revenues: $11.6 Billion
• Television
• FOX, FX, FMC, Fox News Channel, National Geographic Channel, Speedvision and
Outdoor Life, Fox international sports channels, Golf Channel, Health Network, Television
Games Network, TV Guide Channel, internationally extensive holdings in cable, broadcast,
and satellite TV in Asia, Europe, Latin America, and Australia
• Production including Twentieth Century Fox, Regency Television among others
• Books
• HarperCollins (and all its imprints), Zondervan (largest commercial Bible imprint)
• Newspapers & Magazines
• TV Guide, NY Post, the Star, the Boston Herald; in Britain: The Sun, the London Times, News of
the World, the Australian, the Daily Telegraph, the Herald Sun
• Movies
• Twentieth Century Fox, Fox 2000, Fox Searchlight, Fox Animation Studios, New Regency,
Fox Home Entertainment, Fox film library
• Other
• Weekly Standard, TV Guide, stakes in internet sites including ChinaByte.com and
broadsystem.com, licenses for The Simpsons, X-Files, and other Fox properties
• Sports including New York Knicks, New York Rangers, New York Liberty, New England
Seawolves, Hartford Wolfpack, Madison Square Garden, management of Hartford Civic
Center; Los Angeles Dodgers and Staples Center, Dodger Stadium and Dodgertown;
National Rugby League
BSkyB News and Manchester
United
Murdoch Soccer Deal Sets Up Bigger Play
Goals for Media Empire Motivate $1-Billion Purchase of Famed Team
MARJORIE MILLER, Times Staff Writer LONDON--There is one reason
media mogul Rupert Murdoch would spend $1 billion and change to buy
Britain's most revered soccer team--more than three times what he paid for
the Los Angeles Dodgers--and it is not just to tweak the noses of Manchester
United fans.
Even more than potential profits, owning one of the leading teams in
the world's most popular sport gives Murdoch's News Corp. enormous
clout with broadcasters worldwide, while guaranteeing that its games
never leave the company's flagship satellite service, British Sky
Broadcasting, an international cable news and entertainment network that is
the dominant pay television source in Britain.
Have A Nice Day?
• "Our reach is unmatched around the world. We're reaching
people from the moment they wake up until they fall asleep. We
give them their morning weather and traffic reports through our
television outlets around the world. We enlighten and entertain
them with such newspapers as The New York Post and The
Times (of London) as they have breakfast, or take the train to
work. We update their stock prices and give them the world's
biggest news stories every day through such news channels as
Fox or Sky News ... And when they get home in the evening
we're there to entertain them with compelling first-run
entertainment on FOX or the day's biggest game on our
broadcast, satellite and cable networks. Before going to bed, we
give them the latest news, and then they crawl into bed with one
of our best-selling novels from HarperCollins."
— Rupert Murdoch, News Corporation, 1999 Annual Report
The wird one - General Electric
Revenues: $129.9 Billion
• Television
• NBC, CNBC, MSNBC, A&E, History and Biography channels (shared), Snap TV, AMC,
Bravo, WE, and Independent Film Channel; regional news, sports, and entertainment
channels; Canal de Noticias NBC and TV Azteca; Production including NBC Productions,
Radio City Television, Bravo Original Programming, IFC Productions, Next Wave Films,
Satellite DBS Provider
• Internet
• Snap, NBC.com, CNBC.com, Salon.com, polo.com
• Other
•
•
•
•
•
Ammonia plants, Nuclear reactors
Aircraft engines; GE, Hotpoint & other appliances; light bulbs
14 communications satellites, cars, computers
MR and CT scanners, X-ray and ultrasound machines
Health, accident, and long term care insurance; investment and retirement plans; mortgages,
home equity and commercial real estate loans, car loans,
• Credit card application processing, sales authorization, and collection services for retailers in
23 countries
• Owns stock in retail, financial services, telecommunications, healthcare, food and beverages,
cable and broadcasting industries; leases 1,000 aircraft, 190,000 railcars, and about 1 million
cars, trucks, and tractor trailers
Vertical is up-down…
• By controlling the media vertical supply chain, a
conglomerate can generate enormous profit out
of its media products.
• Therefore, if a media conglomerate has a
successful movie, it could promote the file
through its broadcast properties, and then use
the film to spin off TV programs, musical CDs,
books, merchandise, etc.
• As Viacom’s CEO Redstone put it: “When
you make a movie for an average cost of $10
million and then cross promote and sell it off
of magazines, books, products, television
shows out of your own company, the profit
potential is enormous.”
• For example, Disney’s 1994 animated film The
Lion King generated over USD 1 billion in
profit. It also led to a lucrative Broadway
show, a TV series and all sorts
of media spin-offs. It also led to 186 items of
merchandising.
• The common parlance for such practice is
‘synergy’ which attempts to boost sales by
promoting products across media where for
every ‘hit’ movie (or any other media
product) there is a TV series, soundtracks,
books, plastic mugs, etc.
• In another example of ‘synergy,’ Disney takes
its lucrative ESPN cable channel and use the
name to generate other
products, including ESPN radio network. In
1996, Disney launched ESPN Magazine to
compete directly with AOL-Timer Warner’s
Sports Illustrated. Using incessant promotion
on ESPN, the magazine exceeded initial
estimates with a circulation approaching
500,000 after a few months. This resulted in
the launch of ESPN Grill restaurants to
appeal to those who wish to combine sports
with dining out.
Synergy
• Corporations crosspromote products
• Dreamworks Shrek
ignored by Disney media
• CNN plugs Turner Classic
Movies
• NBC promotes GE-backed
airplane
Batman Synergy
Average American heard 42 mentions by time film opened
Divine secrets of Ya Ya synergy
• 2002 Time-Warner-AOL film
Divine Secrets of the Ya Ya
Sisterhood
• Location of key scene changed
from New York Times to Time
magazine
• HBO showed Media show 28
Days almost daily
• Sometimes followed by HBO
Behind the Scenes: The Ya Ya
Sisterhood
BUT . . .
• Time magazine gave
the film a mediocre
review
• Media synergy doesn't
influence all content
• Not yet . . .
Conflicts of Interest?
• Disney owns ABC
• How does ABC cover
Disney?
• How does TimeWarner-AOL cover its
many interests?
The Power of The Few
Media power
• The study of power relations forms the basis of the
study of media and communications.
• Power and knowledge are closely interlinked.
What is power?
• Power is the means by which certain individuals and
groups are able to dominate others
• Power is potentially or actually part of all social
relationships
• Usually a person who has control also has power
• Media Power is exerted by controlling the
informational environment, system of influences,
commands and feedback
Newspaper organization
Proprietor
Press manager
Circulation
News Editor
Editor
Advertising manager
Chief of News Bureau
Chief sub-editor
Chief Reporter
Sub-editors
Reporters
Special correspondent
Photo Editor
Photographers
Sports Editor
Foreign Editor
Reporters/ sub-editors
Correspondents
Who has power over media
content?
• Traditionally = Editors
• Now?
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Competition in the market place?
Interest groups?
Advertisers?
Audience?
Readers?
Government?
Owners?
How can outside influence
control editorial decisions?
• Operational:
Control of editors / reporters
• Allocative: Through the allocation of
funds / personnel for certain
programs or certain sections
the newspaper denial
for other sections
programs
• External:
of
of funds
or
Pressure from advertisers /
consumer groups
Media Diversity
• Media diversity is when media outlets are
owned by a number of persons making
diversity of opinion a realistic expectation.
• Democratic governments attempt to ensure
diversity and are wary of concentration in
media ownership.
• Governments attempt to ensure diversity and
are wary of concentration in media
ownership
Convergence
and Diversity
• Corporations own a variety
of media outlets and shops
• TV, radio, movies, books,
magazines newspapers,
Internet
• In effect this reduces
choice and diversity
Or
Critics of consolidation
• Mergers limit number of
independent voices in
media
• Limits free exchange of
ideas
• Facilitates censorship
• Profit imperative, rather
than quality, determines
programming
Rupert Murdoch as Mao
Government controls on media
• Airwaves are in the the
public domain
• Radio /TV bound by
public service
requirements.
• BUT Governments are
reducing limits on media
consolidation
• More choice at lower
prices?
Corporations and Culture
• Fewer media businesses
= less choice of
opinion?
• Corporations control
more culture industries
• This drags down
standards
• Leads to more “trash”
• Future of freedom of
speech
Oligarchy powers
• Monopolies are noncompetitive
• Hypercommercialize
content without fear of
competitive retribution
• US commercial radio = 18
minutes of ads per hour
• Low quality populist
output
Media Moguls
• ‘Media moguls” are
persons who own and
operate large media
corporations in a personal
or eccentric style
• Moguls occur when there
are one or a few players in
the media scene
• Gives rise to fears of the
reflection of one point of
view.
Censorship
• Rupert Murdoch's (News Corp.)
• HarperCollins cancelled publication of book
by Chris Patten former British Government of
Hong Kong
• Why?
• Patten critical China
• Fact. News Corporation has huge interests in
China
• Self-censorship an even greater concern
Conclusion: Should
I be Concerned?
• Historically speaking, the origins of what we
term as the media has its roots in newspapers
that proliferated in the 19th century.
• The function of newspapers was to inform and
educate its readers on the issues of the day as
well as disseminating ideas.
• However, the 20th century have witnessed the
gradual evolution of the media that moves away
from news to entertainment.
• And the trend in media ownership in the past
twenty years is simply accelerating the media’s
move towards entertainment.
• With the emphasis towards profitability,
rather than social responsibility, media
content have increasingly been watered (some
would say dumbed) down in an effort to
entertain us rather than inform and educate
us (or what Neil Postman calls as “Amusing
Ourselves to Death.”
• And given the pervasiveness of the media in
our lives, its influence is undeniable.
• We are what we read, see and hear through
the media. And the message of the media is
simply this ‘Resistance is futile. Become part
of the mindless audience hive that consumes
what we offer.’
The Future?
Research Questions
• Can the internet and other new technology
break the hold of the media giants?
• Is the influence of the media giants benign or
harmful to democracy and freedom?
• Is too much power in the hand of too few?
Entertainment Industry Value Chains
The Future??
103
Rippers Bittorrents Downloads
• The big guys fight back!
Insight on Technology: Hollywood
Needs a New Script
• Digital videos available on P2P networks threaten
existing Hollywood business models
• Industry system of distribution windows to stage
release of new films being ripped apart by digital pirates
• Hollywood has hired a “police force” that trolls
Internet looking for free copies of movies,and then
sends infringement letters to offenders
 Questionable how effective this will be
• Legitimate alternative: Movielink a joint venture of 5
studios
Homework - Yes Homework
• For the next 3 days, you will keep a log of the
media that you spend time with together with a
brief note of the content of such media.
• Please create a blog (weblog) of all your media
consumption