workbook

1. BTEC Extended Diploma in Creative Media Production
Unit 7: Understanding the Creative
Media Sector
Learning outcome 1:
Understand the structure and ownership
of the media sector
Name: Coral Welburn

2. BTEC Extended Diploma in Creative Media Production
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 where people or shareholders, who are private citizens, own a
company rather than the government. Private ownerships are all about satisfying
the shareholders, rather than worrying about public interest. It is all about
advertisements as that’s what funding the ownership. When it comes to showing
advertisements it all depends on the particular channel. Channels such as MTV
target ages 16-24. Which will only show advertisements that would satisfy this
target audience, whereas advertisements on the discovery channel would be
completely different as the target audience is different. However channels such as
BBC show a variety of different advertisements as it shows a variety of different
programmes that target lots of different age ranges. There are many advantages
and disadvantages to private ownerships. One of the advantages of private
ownerships is that because its based purely on advertising funds meaning more
companies are willing to fund private ownerships as that means more air time for
advertising their products. The more popular a channel and show means the more
it costs to advertise products during certain times, which means more money for
that certain channel to fund more shows. However a disadvantage would be that
proper research isn’t done into the audiences likes and dislikes, it all depends on
the funding’s like and dislikes meaning that it could easily fail if it isn’t watched by
enough people.
Public service broadcasting is… is either owned by the state which is the
government, of commercially owned which is where money is made through selling
advertising space and product placement. It is all about showing content that isn’t
all about commercial gain. This is done through showing content such as news, art
programmes and religious views. This is shown through television or is
broadcasted through the radio, which are two popular ways of broadcasting
information that is important to get across. Public service media have the same
purposes and values as broadcasting, but its done in a different way. Such as
showing things on digital media, such as the internet. This particularly targets youth
audiences. In the united kingdom there are a variety of public broadcasters such as
the BBC, Channel 4, ITV and Channel 5. There are certain requirements that need
to be followed with broadcasting which is set by Ofcom, which is all part of the
licence to broadcast. Channel 4 is required to broadcast programmes that cater for
art and minorities. It was set up to be a “public service alternative to the BBC”

3. BTEC Extended Diploma in Creative Media Production
(http://en.wikipedia.org/wiki/Public_service_broadcasting_in_the_United_Kingdom).
It’s a self-funded channel, which is funded through commercials. The BBC is a
state owned broadcaster. There are a variety of ways the BBC broadcast. Its done
over the television, radio and internet. They provide an online broadcast called
BBC I Player, which gives the you option to catch up on missed programmes, or
too watch live. Also it shows online only programmes.
Multinationals are…are large companies that are occasionally owned by large co-operations
which sell/present products across the world in many different countries.
For example Nintendo is a Japanese multinational electronics company that have
become one of the largest video game companies. Nintendo originally started out
making handmade cards in the late 1960’s, however now in 2014 it has developed
into a video game company that is said to be the most influential. There are a
variety of products being sold worldwide such as hand consoles such as the Ds
and home consoles such as the WII, but then there are video games made for
these consoles, along with the equipment made for them that are the controls for
Mario kart and the traditional wii games. Having presences in different countries
across the world is so good for businesses as they have a better understanding for
the market and what ‘the in thing’ is and what competition they have to work with
and better themselves against.
Independents are…refers to any type of media, which could be the radio, internet,
television or newspapers. Independent ownerships aren’t backed by anyone, its
usually one or two people that start something out that don’t have other peoples
influence such as the government. With these ownerships things can only go one
or two ways. Companies can do well and be bought out by other companies as
they have done so well with what they started out. Companies such as Avalon
television. They started out in 1989 and throughout the years have gone on to have
many companies in different categories such as television, advertising etc. Also
The independent Newspaper is another example. It was put together by three
journalists that had quit their jobs in at the daily times. It did well but faced a lot of
difficulty throughout the many years it ran causing independent media and news to
sell the newspaper to a Russian individual.
Conglomerates are…are where there are two or more co-operations that are
involved in different businesses that are linked under the same co-operate group.
"Media conglomerates strive for policies that facilitate their control of the markets
around the world." (http://en.wikipedia.org/wiki/Media_conglomerate) For example
Time warner and warner brothers work together to produce high quality films.

4. BTEC Extended Diploma in Creative Media Production
Voluntary or not for profit organisations are… are all about helping a certain cause
going on to working to affect social changes. These organisations all have different
aims whether that be to earn money or not. With making a profit these
organisations then go onto use that to put back into their work. Some organisations
pay their workers, but most of them have volunteers that just genuinely want to
help. For example the media trust have a number of projects and their aim is to
help the media industry help charities and the community be empowered and to be
heard by the public. This trust have 20 years of experience and success, which has
brought them a community channel on tv and online, also gaining an audience
through the news distribution service.
What are some of the challenges faced by independent media companies?
Because independent companies are done with a minimal amount of people
involved, meaning that no one such as the government are backing you, it means
that a lot of financial problems fall onto the partners backs. There are a lot of
financial risks. A lot of money is put into the company you are creating, which could
be lost or profited back. However there are many challenges in lots of different
media companies. For example a challenge that is faced by newspapers is the
decline of sales due to the newest technology. What this is doing is providing you
with the newspaper online, or delivered to you on your phone or other device such
as a tablet. The internet and social media sites are taking over, causing the
newspaper sales to decline. For example the Bay Guardian, a san Francisco
independent weekly paper was suddenly shut down, telling everyone to pack their
desk and leave. It ran for a solid 48 years however was soon bought out by their
rival, which shut it down flat as it was just a numb newspaper that was declining
fast with the way the media life has changed. All companies have a target
audience that they are willing to capture the hearts of, all having an aim to please
certain things with what they publish or create. Cillian press create and publish
fiction including contemporary, literary novels, young adult fiction etc. This is
directed at a certain type of audience so there are risks with not fulfilling those
choices and not having enough readers who enjoy the specific things posted. Also
with it being a new publishing company, there are certain numbers that need to be
reached so that there isn’t any type of debt or chance of going under.
What are some of the challenges faced by multinational media companies?
There are plenty of challenges that come with having so many businesses
worldwide. There are different rules and regulations in different countries, so you
have to make sure that they are followed in each country, which makes it hard as
there are so many different ones to follow that perhaps you can’t without not
following a different one in another country. Another problem would be having so
many companies in so many different places doesn’t help you stay focused and
aren’t able to see the finished products if you aren’t here. Which means that more
money is spent on having people in each different company practically doing your

5. BTEC Extended Diploma in Creative Media Production
job for you since you can’t be there all the time. Multinational companies don’t
always make it because there is too much money going into controlling and
running it, without making enough profit back unless you are a large enough
company like Sony.
What is cross media ownership?
Cross media is where organisations own more than just one company in the media
business, for example where a newspaper and television station is owned by the
same organisation. Having a variety of different media company’s gives you the
insight of what appeals to different audiences and what you can change within
certain companies that is going well with one that is going well for another. Also
owning more gives you a better financial state, giving you more profit to then go
onto put more work into making things better within the company you own. An
example of cross ownership would be Walt Disney. They own around 30 different
radio stations, music and book companies, along with also owning disney channel
and animation studios.
What is diversification?
Diversification is where large companies go on to own companies that produce
products that are related to each other, however also can be un related. For
example Virgin branched out from just been a music distributor going on to
producing things such as virgin media, the phone network, broadband, radio
stations etc. Branching out and producing different things can help a company
massively, it brings in a variety of audiences who learn to trust the company, then
going on to getting involved with the other things they own. For example having a
phone with them, to then go on and set up something else with them that interests
them. So wether it be related or not, it helps a business.
What is horizontal integration?
Horizontal integration is where more than one company is owned at a time, but
they are all at the same level of production. It gives companies the chance to
branch out and expand in one particular area of production, or buy out companies
that work in that area.
What is vertical integration?
Vertical integration is where companies are owned, but are at different levels of
production. Meaning that companies have the ownership of the production, the way
its distributed and the way it’s shown to the audience/customers.
What are some of the advantages of these different ways of structuring a
company?

6. BTEC Extended Diploma in Creative Media Production
The advantages of vertical integration are that you work with smaller departments
that can closely monitor and control the activities of the department you’re working
with, which then gets reported to top management. Each “layer” has its own
responsibilities as a company and all can work as a close group as they are all
working within the same company but they all have allocated jobs to do in each
process.
The advantages of the horizontal structure is that everyone is working at the same
speed and the same level of production, knowing exactly what to do in that specific
area, having enough people working knowing what to do so that nothing can go
wrong and that the highest level of achievement is achieved. There is more
freedom as there aren’t layers of people and process’ meaning the team will be
able to adapt easier to change as there aren’t too many people at different stages.
Use the following table to show how the Disney Company is structured.
Production
Distribution
Screening
What different ways can ownership are shared out?
There are many different ways in which people can get involved and ownerships
can be split. For example shareholders can choose to invest if they like the idea
of what you’re wanting to or have already producing, believing it would be a good
business deal that could perhaps make them a lot of money or be better for them
in the future. There’s also the option of companies owning parts of other
organisations. However there is so much of companies that people can own as in
the uk there is a set limit.
What is a merger? Why would companies merge together?
A merger is the combination of two previously separate organisations that have
come together as one to create something entirely new, leaving no remains
behind of either company, completely taking away each ones independency.
Companies now merge together because neither one is doing well alone so they
believe combining two companies together and putting each ones shares and
profits together will be enough to make something new with fresh ideas and
research properly done into what they are wanting to create. In 1990 Time Inc.
merged with warner brothers to created time warner cable, which happened to
create the biggest media conglomerate back then. Then that company went onto
merge with AOL in 2000.
What is a takeover? Why do companies take each other over?

7. BTEC Extended Diploma in Creative Media Production
A takeover is where a much larger company purchase a smaller company to
perhaps build and work on, or change to become something of their own.
Takeovers have become more popular as larger companies are wanting to build
their ‘empire’ and become more popular and have a variety of different
organisations and companies to bring more profit in leading to better quality
products and been able to then go onto expand more and more. For example
recently Facebook purchased WhatsApp as it was a failing app for devices, to
then go on and advertise it on their set ups and on peoples Facebook pages as it
was wanting to start off again and do well.
What is cross media regulation?
There is a certain limit in the media world with how much you are allowed to own
as a company. There has been a regulation that has been set up, this is
controlling the amount of what can be owned across the different categories of
media that is about. There are restrictions set on most media related things.
Notational and local newspapers have restrictions and limits, just like TV licences
and radio stations.
Should we have restrictions on the amount of media outlets people can
own?
Restrictions set limits on what can be owned by who and in what media
category. People say that the more ownership you have, the more power and
influence you have over the media industry and it leads others to believing your
views and the way thing should be set. Having too much of one person’s
influence doesn’t leave things open for competition and other genres of products
produced by different people But then others say that people should be allowed
freedom with how they want to live their life and if they are wanting to have a
career owning different companies in different areas of media then it should be
allowed. However I think that if you’re good at something and the companies you
own and the organisations you are involved in are doing well and rapidly
improving with profit, then why shouldn’t you be allowed to own whatever amount
of something you want, but then I wouldn’t want so much of the same persons
influence on things. So i would say having restrictions isn’t a good thing, but then
i would see where people are coming from when they say they want a variety of
products to choose from than a few people owning a huge amount of things such
as radio stations, tv stations, newspapers etc. because it would all be run in the
same way and the end result would more a less be the same, which wouldn’t
interest people and wouldn’t raise profits to the limit you want because there isn’t
that much to compete with.
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.

8. BTEC Extended Diploma in Creative Media Production
What income streams does your chosen company have?
Disney is a huge company that has expanded over the many year’s it has been
alive. Disney has a wide variety of different income streams such as their parks
and resorts in many different countries. For example there is Disneyland Resort,
Hong Kong Disneyland, Disney Cruise Line, Vacation club etc. But once you’re in
these parks and resorts there are often many things you still have to pay for, for
example there are many products sold by Disney such as the stuffed animals,
photo booths, food stands. In Disney land resort there are two theme parks, three
hotels and a Disney shopping, dining and entertainment district. Because of the
explosion of success there is plenty of income that is made with just one resort as
there is so much included inside past the sign. Disneyland resort has had over
650 million guests alone since 1955. However Disney offers many more options
such as television channels. There is Disney channel worldwide, ABC News,
ABC family, Disney Television group and ESPN etc. All these channels are
massively popular. Disney Channel is a worldwide channel that expands into a
portfolio of entertainment channels that is fed into 169 countries, then been
translated into 35 different languages. Disney also have a variety of studios such
as Walt Disney animation studios, Pixar animation studios, Walt Disney studio’s
motion pictures etc. Then there is Disney interactive which produces
entertainment such as where’s my water?, club penguin etc. There is a hundreds
of different ways that Disney makes money which explains why it is such a well-known
company.
What is product diversity? How diverse is your company’s product range?
“Product diversification is a process by which businesses attempt to expand their
market reach and customer base by delivering products somewhat different than
the ones for which they are known.” http://www.wisegeek.com/what-is-product-diversification.
htm
The products that are produced don’t have to necessarily be different products
entirely, they can be extensions. For example coke was brought out, then it
brought out diet coke which had the same forma with fewer calories. But then that
brought in an entirely consumers who were conscious about their weight but
wanted something refreshing. Walt Disney are all about providing entertainment,
whether that is through theme parks or television. Walt Disney is extremely
diverse as its constantly bringing out new ways to entertain, that through
consumer products, so bringing a new theme into store which is either improved
on or entirely new. As they are most known for their princess base, they tend to
want to bring new characters in each summer year so that there is new action in
the studios and resorts, so that for returning customers they aren’t seeing the
same things every year.
What advantages does this give your company in the market place?
This gives the customers an element of surprise and mystery, which is
constantly luring them back in as Walt Disney are constantly making something
new. This keeps people interested and intrigued. Because they have so many
different ways of entertaining, there is constant competition for other competitors

9. BTEC Extended Diploma in Creative Media Production
as they are having to try and compete with the speed that walt disney sells and
produces things, so to customers that gives them the secure trust level with
knowing they are going to get their money’s worth.
Why is the profitability of a product range so important to a company?
Profits are what keeps company’s going, being able to pay the staff but then also
having the money to keep everything running smoothly in the different parts of
the company. The profitability of products ensures you that you’re doing
something right and that your product is selling and making you money, not
costing you it. It re assures you that the way you’re doing things works for the
certain target audience and that you are able to run other products with the same
structure you did with the ones that are earning you the most money.
What advances or disadvantages are there in making big budget,
mainstream products?
Because Disney have a wide variety of products to offer there is research into
likes and dislikes that need to be done. When making merchandise for well know
films there has to be designs done that match the characters very well to be
considered part of the set, otherwise customers will be unhappy and won’t be
willing to pay the price Disney are charging if it’s not well made. An advantage to
making big products would be people are willing to pay that little bit more to just
have the Disney logo on and be able to say it’s made by Disney and its an
original, rather than a look alike or fake. That means more profit is made for the
company if people are willing to pay more. However a disadvantage would be
that it costs a lot to make so much of one product, and if it doesn’t sell as well
then you have lost out on money that could of been spent on something else.
What are some of the objectives of your chosen company?
Disney has been around for many years and are all about bringing the
imagination to life. They want to impress their young target audiences as they are
the ones with the most magic and belief in their bodies. However they also need
to keep things going smoothly, so their main objective is to make a profit in 5
different ways. Through their networks, parks, products, interactive and studio’s.
They all offer so much for families, couples and people of all ages to enjoy,
however it comes at a price but because it’s such a popular company that is
known for providing a good experience people don’t mind paying the price that is
asked as they know that it’s a once in a lifetime opportunity.
What are the advantages/disadvantages of taking part in a media
franchise?

10. BTEC Extended Diploma in Creative Media Production
(Use examples from your chosen company as well as others. Use specific
examples to help support your writing. Facts, figures and detail with help you
comprehensively explain the answers to these questions.)
What, if any, products does your company license?
Disney has a retail chain which is owned and operated by Disney in and around
Europe, North America and Japan. Disney also are the worlds largest publisher
of children books and magazines with over 700 million products sold each year.
Disney have been licensing since 1929. DCP is the world’s largest licensor which
goes on to inspire people by bringing “the magic of Disney” into consumers’
homes with products they can enjoy all year round.
The Disney stores include products that have been made to advertise films and
books. For example there are certain parts to each store that represent certain
themes from films and books. There is a Frozen theme, along with tinker bell,
monsters Inc., the traditional Disney characters, princess and the frog etc.
Everything follows a theme that includes dolls, mugs, books, cups, clothes, bags,
suitcases etc. They sell everything with animated pictures printed onto the
products. Disney make everything themselves as they want to make sure
everything is done correctly, including the correct colours and themes, along with
the correct text been put onto the merchandise. Having everything involved within
the company is better as it can be monitored correctly and it can be done by staff
that are employed to do a certain job, without having to pay other company’s to
do if for you when there are plenty of staff that will do it under the Disney name.
Who is in competition with your company? How successful is your
company in comparison?
Even though Disney do so well in the media industry, there are still a variety of
competitors that they have to compete with to better themselves and improve.
Time Warner and 21st Century Fox are also hugely popular. Time warner is one
of the largest conglomerate company and specialises with businesses in
television networks, film and television entertainment. This is done with divisions
such as turner broadcasting, home box office and Warner bro’s. They all work
together to sell and show things such as the hobbit, American dad and gotham
which are all major films and programmes worldwide. Time warner also has
products such as online games, online programmes and apps for mobile devices
that allow you to watch streaming of their products. Time Warner is classed as a
competitor because of the wide variety of selling products that are on offer,
because of the different channels, printing publishers, comic books that they are
involved it means that they are are also bringing in a big amount of income,

11. BTEC Extended Diploma in Creative Media Production
leaving them with money to be able to create more products that could perhaps
be widely popular, just like things Disney sell are. So Disney have to compete to
perhaps show a better programme that time warner would on one of their
channels. Walt Disney do so well for themselves in the category tv and film that
having competition is healthy. Disney has been around for so long that people
just know what they produce is worth watching and buying because its such a
trusted company. If there was no competition between company’s there would be
no one there to keep pushing to create things that are going to do well and not
fall under something that their competitors have produced. Competition helps
better yourself. For example in 2007 Walt Disney released pirates of the
Caribbean 4 which is in line with 3 other terrific films that were widely popular with
the public, targeting ages of 15 and over, however around the same time is when
Harry Potter and the order of the phoenix came out. Both films target the same
audience so this is an example of competition. They are both really popular films
but its all about the advertisement of the film and the way its sold to the
customers. For example advertising it on television and the channels they own
themselves. If its sold across the right way then you have a better chance of
selling the product fast. Walt Disney has a wide selection of film genres,
animation being the most that is worked with.
Who are your customers?
Everybody thinks that Walt Disney’s customers are young girls because of their
large princess collection. For many years Walt Disney has attracted little girls
because of films such as Cinderella, Sleeping Beauty, Snow White and the seven
dwarfs etc. However they wish to target the whole family as recently they have
started to sell films that are remade from older versions that were published. So
more older people are buying Disney films as its a part of their childhood being
brought back to life. Disney has a saying Your dead if you aim only for kids.
Adults are only kids grown up, anyway."
http://thewaltdisneyco.blogspot.co.uk/2011/09/chapter-4-marketing-environment.
html this is a good saying because now they have a wide variety of
products to sell that can involve many different ages and both genders. But their
main customers who buy the products are parents for their little kids as most of
their products are from films such as tangled, frozen, alladin, little mermaid etc.
However that is in the television and film category. The customers for the resorts
and parks are families who are wanting a vacation being able to go meet all the
characters and go on the rides that follow the disney themes. Wether that be on a
cruise, at a resort or a studio.
Which global media trends are affecting your company right now?
Dvd’s were the in thing many years ago but there is constantly being new
technology and new software’s being brought out for us to download or buy.
There are many websites online that are now uploading tv series, new films, old
films, box sets etc onto their site which then allows you to download or play
instantly for free. This is causing many people to stop buying dvd’s as its just on
the internet for you too watch. This isn’t good for walt disney as a large chunk of
their profits are from dvd buys from shops that its placed in, such as
supermarkets or dvd shops.

12. BTEC Extended Diploma in Creative Media Production