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1) Why did Facebook buy Instagram for $1bn in 2012? To not only eliminate competition but to create more opportunities to earn money.
2) What are the benefits for media companies of vertical integration? They can save money on production and distribution costs since they own the companies branches that do said distributing and producing, meaning money does not have to be paid to external companies and can instead be spent on their own company. In addition to this, all earnings from the media they produce go to their company, so profits do not have to be shared.
3) What are the benefits for media companies of horizontal integration? With horizontal integration, the company can reach a larger audience, without having to wait for their platform to expand. An example of horizontal integration is Facebook buying Instagram.
4) What is a subsidiary? A subsidiary is a smaller company that is owned by a larger company, for example, Island Records is the subsidiary of Universal Music Group.
5) Give three examples of media companies that have used synergy to maximise the profit from a brand (there is one above to help you).
One company that has used synergy to maximise profits is Disney. Another company is Time Warner. a final example is Comcast, this is probably the most successful example of synergy
6) Read this BBC article on Disney buying 21st Century Fox. List 10 companies that are part of the Disney media empire.
The Disney Empire
1 > Pixar
2 > Marvel
3 > Lucasfilm
4 > Dreamworks II
5 > Star Wars (.com)
6 > Hulu
7 > ESPN
8 > ABC Entertainment
9 > The Muppet Studio
10 > Vice
7) Why did Disney buy Fox - what are the benefits? They save more money on distribution. Additionally, they eliminate competition, meaning they can earn more money from a larger audience.
1) Why did Facebook buy Instagram for $1bn in 2012? To not only eliminate competition but to create more opportunities to earn money.
2) What are the benefits for media companies of vertical integration? They can save money on production and distribution costs since they own the companies branches that do said distributing and producing, meaning money does not have to be paid to external companies and can instead be spent on their own company. In addition to this, all earnings from the media they produce go to their company, so profits do not have to be shared.
3) What are the benefits for media companies of horizontal integration? With horizontal integration, the company can reach a larger audience, without having to wait for their platform to expand. An example of horizontal integration is Facebook buying Instagram.
4) What is a subsidiary? A subsidiary is a smaller company that is owned by a larger company, for example, Island Records is the subsidiary of Universal Music Group.
5) Give three examples of media companies that have used synergy to maximise the profit from a brand (there is one above to help you).
One company that has used synergy to maximise profits is Disney. Another company is Time Warner. a final example is Comcast, this is probably the most successful example of synergy
6) Read this BBC article on Disney buying 21st Century Fox. List 10 companies that are part of the Disney media empire.
The Disney Empire
1 > Pixar
2 > Marvel
3 > Lucasfilm
4 > Dreamworks II
5 > Star Wars (.com)
6 > Hulu
7 > ESPN
8 > ABC Entertainment
9 > The Muppet Studio
10 > Vice
7) Why did Disney buy Fox - what are the benefits? They save more money on distribution. Additionally, they eliminate competition, meaning they can earn more money from a larger audience.
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