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Smaller production companies may have private ownership; owned equally by 3

or 4 persons. Services of this production company can be hired out to the
productions of small projects but as the size of the company grows, as will the
projects. Profits are made from the productions, in return for the services
produced. This would require the investments of outside vendors, and depending
on the scale of the production company and the size of the funds required, the
ownership will slowly dilute until the company evolves into a public limited
company (PLC). The more the company then makes, it how much is invested in
future productions. An example of this is a London – based Production Company
named “Liquid Productions.” The ownership of this company is divided by three
owners, and has no shareholders in the company; this makes it a privately
owned company. The advantages of this is the profits made; the private owners
make a more concentrated amount of money in relation to the intake. Despite
this, less shareholders mean less investments; which means the companies have
less of budget to produce films. This may result in lack of interest from
companies willing to pay for services; thus the companies take off would be
halted.
Multinational companies are companies that have expanded to countries other
than the country of its origin. To be classified as a “multi-National” company, it
has to have a presence in more than one country and have speakers of multiple
languages. The concentration of media in America and the United Kingdom
means a large influence of western film cooperation’s across the world.
Independent films are made mostly or completely outside of major film
corporations and are usually produced by private funding. The films are almost
always produced and distributed by private companies. An example of a multinational company is Disney; it has multiple versions of the countries. Multinational companies mean a larger market for the products released by the
companies, but also allows access to different resources regarding marketing and
actual film production.
Conglomerates are large media based corporations that own a large number of
media based companies such as television, film, newspapers and radio. The
benefits of a conglomerate is the investments in products is larger due to more
gross in money. This also allows the production to grow and mass produce
programming that they know that customers respond positively too. An example
of this would be reality TV; Reality TV shows are mass produced due to the
positive influx in ratings. Conglomerate companies are able to monitor popularity
and decline in current topics, trends and media platforms. This allows the
conglomerates to be able to keep up with public interest, and remain popular.
An example of a conglomerate is virgin media, a company that owns
transportation lines as well as a broadband company. Owning both a
transportation line as well as a broadband company is beneficial for Virgin, as it
means if business is on a decline in one sector, the company has profits from
another to benefit from. However, Virgin may find themselves at a disadvantage
when it comes to decision – making. Being one of the world’s largest companies,
Virgin has many levels of management; meaning that it would have to be passed
through all levels before it can be verified and moved forward. This may cause
the company to miss opportunities regarding hitting target audiences and
products being successful whilst still holding relevance to the market.

Cross – marketing media is the process of using different forms of media in order
to promote one another. An example of cross – marketing media is a popular
artist releasing a song for the soundtrack of a film. The artist receives the profits
for the song, but also promotes the film, and vice versa. For example, for the
release of the film “The Hunger Games: Mocking jay Part 1” the artist Lorde
released a song for the soundtrack. This is an example of cross – media, a
popular artist releasing a song for a popular movie franchise. Cross media has
its limitations, in 2002 the FCC ruled the following; Single-company ownership of
media in a given market is now permitted up to 45% (formerly 35%) of that
market. Restrictions on newspaper and TV station ownership in the same market
were removed. All TV channels, magazines, newspapers, cable, and Internet
services are now counted, weighted based on people's average tendency to find
news on that medium. At the same time, whether a channel actually contains
news is no longer considered in counting the percentage of a medium owned by
one owner. Previous requirements for periodic review of license have been
changed. Licenses are no longer reviewed for "public-interest" considerations.
Vertical integration is the process in which several steps in the
production/distribution are controlled by a single company; this increases the
company’s place in the market. For example, a company that produces beef
burgers may vertically integrate and buy a cattle farm; this would significantly
reduce the cost of obtaining the raw ingredients, thus increasing the company’s
profits. Horizontal integration is the process of taking over a competitive
company in order to progress further and eliminate competition. An example of
horizontal integration was the takeover of YouTube by Google; this boosted
Google’s fan base. The unique nature of YouTube, eliminated all competition by
buying the company, therefore Google did not have to compete with the
company. The takeover was beneficial for YouTube also as the promotion from
google boosted the usage of the website; also the use of google advertisement
boosted profits for both companies. However, the profit
Small production companies begin to develop and the size of projects increase;
they may begin to sell small parts of the company in “shares.” This means that a
certain amount of all profit made is given to the shareholders. Shareholders will
invest money for projects; then potentially make it back with profit.
A takeover is where a company makes bid in order to buy the company, if the
takeover is successful, the company who takes over is now responsible for that
company, from staff to debts. An example of a takeover is when the sports
clothing company “Under Armour” took over phone app “My Fitness Pal.” A
merger of two companies is the process of moving them together and connecting
them; the two companies would then contain a blend of element of both
companies. For example the £19bn deal between Facebook and WhatsApp
benefitted the company as not only will it boost profits, but will boost Facebook’s
younger user numbers, which has dropped significantly. The WhatsApp/Facebook
takeover allowed them to merge their services, which meant that the customers
had access to both, boosting both of their rates, including money made from
advertising. However, it may cause the companies to lose customers due to
drastic changes of the service.
Media companies can generate revenue through investors, donations and
money profited from productions. As popularity increases so do the sources of

income. An example of this is the film “Attack the Block” this film was funded by
The National Lottery, who were then paid back a percentage of the profits. This
can be risky for the companies who place investments in the films, as they may
not gross a large amount money, thus losing the company money. However, it is
beneficial for the promotion and encouragement of inexperienced film – makers.
Product profitability is the amount of money made when the money invested is
subtracted. It’s the amount of profit the product will make and whether the
product will be popular. This means the company has to market the films
successfully in order to make back money and produce a profit.
Diversification
of a product can be made possible by reaching out into a new market or pricing
range. This would be re branding a product designed for people over 60s and
targeting it at teenagers. This could boost the companies’ popularity and return
of profit. An example of this is the reboot of the film series; “Star Wars” by
rebranding the film it has made it popular in a different market of people, thus
turning over a larger profit than the original films.
The goals set by the head of company; this is then organised and set up so the
objectives can be achieved in a certain amount of time. This usually means the
overall long term intentions and ideas for the business to develop and grow. An
example f this would be setting the amount of profit turnover the company hopes
to achieve per annum, the employees of said company would then have to aim
to achieve this in the designated time. This can increase productivity and be
beneficial for the company, but may also cause large amounts of stress for
employees, causing them to loose focus and not be as productive.
Franchising is where several collective works have been produced from one
original piece of media. “The Lord of the Rings” is considered a franchise; 3 films
and 3 prequel films have been produced alongside a range of merchandise of
each film. For a product to be franchised, certain licensing laws have to be
followed. This would mean copyright laws to be followed in regards to the
content used in the original product. Due to fan bases surrounding certain films,
franchises may be a way to produce large amount of profits in smaller amounts
of time. Franchises offer a sense of familiarity to the viewer, which makes them
more likely to be involved within the franchise, buying merchandise, etc.
However, it is argued that the quality of a franchise of films may decline when
production schedules are minimal, in order to release the next film in time.
Competitors are two people or companies striving towards the same thing or
target audience. An example of a competitor is Sony and The Walt Disney
Company; as they both target the same audience, they compete with each other
to produce the best content to draw audiences. Investors have to choose
between companies to buy shares from; therefore companies will compete to
show larger profit margins in order to receive investments for productions. This
means that film releases for an opposing company may damage the profits of
the other; although this may be seen as motivation to produce the best content,
companies may find themselves at a loss in regards to profits.
Customers are the people who pay to use a product or service that a business
sells. Businesses who have the most customers will make more money
businesses build up the amount of customers through diversifying, creating new
products, advertising campaigns and taking over competing companies to get
their customers. Companies aims to satisfy the customer and take complaints

and feedback on board in development of future projects/products. An example
of this is Disney; adverts market children using bright colours and recognisable
characters, but simultaneously target parents with images of families as parents
will be the ones to spend the money. Companies may attempt to target a wider
range of audiences, but find it hard, this may call for rebranding in order to reach
more customers.
Globalisation is the process of developing an international presence; it bring
diversity and different cultures into the media industry. The results of
globalisation can be profitable; allowing media corporations to franchise in
multiple countries. Despite this, it can cause the company to gain more
competitors, which may be harder to surpass due to the general population
deciding to go with a familiar product. Deciding to do this at the right time
financially, would rely on recorded trends; depicting what times the market is at
its lowest/highest allows companies to make decisions on when to partake in
takeovers/international expansions. An example of the globalisation of a
company is Disney; Disney has theme parks in both America and France. The
mass globalisations means there is a wider target market to expand upon.
However, when globalising a company, the company may run into some
problems regarding laws and restrictions. Currently, the popularity of online
streaming has increased significantly. This can be damaging for companies’
profits as the use of DVD is in decline. Not only will companies will lose profits
from DVD sales; this then raises the dispute of whether they should allow
content to be streamed for a fraction of the price. On the contrary, companies
may lose potential profit as clientele may choose to not go to a cinema and
stream movies, eliminating their content and also leaning towards their
competitors favour.