1. Warner Bros
Warner bros is one of the major leading film studios (this makes it an oligopoly), that was
independent from 1918- 1967, but as of 1967 became subsidiary to Warner Bros.-Seven Arts
for 3 years. After that Kinney National Company became their new parent company for the
following 2 years. Then after that Warner Communications became their new parent
company from 1972-1990. Warner bros then came subsidiary to time Warner from 19902001 and then AOL Time Warner took over from 2001-2003, from there Time Warner
became its parent company again and remained to be their parent company from 2003present. As well as being a subsidiary company Warner bros are also a conglomerate and
parent company, parenting several subsidiary companies, including Warner Bros. Studios,
Warner Bros. Pictures, Warner Bros. Interactive Entertainment, Warner Bros. Television,
Warner Bros. Animation, Warner Home Video, New Line Cinema, TheWB.com, and DC
Entertainment. Warner owns half of The CW Television Network. Warner bros has multiple
enterprises making them a conglomerate; they have Warner bros entertainment, Warner bros
records and even Warner bros clothing, which have widened the Warner brothers market.
Independent film companies
An independent film company is a company that is not subsidiary to any companies although
it might be a parent company to other subsidiary companies. Independent films companies
differ from the six major film companies in many ways, which are mainly to do with their
budget, brand identity and accessibility to useful resources, this gives the major companies a
big advantage over independent companies. The main disadvantages of being an independent
film company are the lack of budge which makes it harder to have special effects and A-list
actors. Independent companies are also less popular, meaning viewers may see them as a less
reliable source when it comes to watching their film productions. The main advantages of
being an independent company are that they receive all profit, they have less pressure due to
the fact that they have a smaller budget and aren’t as popular as the major six. Another
advantage is that they have complete control over what they decide to produce, allowing
them to have more choices and chances to become more unique. For a independent film to
function they need to find a way to fund their production, which can be done in a number of
ways, for example getting a loan from a bank or doing events to raise money. After that they
would have to do their production work, which they would have to do without loads of wellknown actors due to the minimal budget. After they’ve finished their production they’d have
to send their final movie of for it to be approved by cinemas which would cost them and
depending on the success of production, they’d make a profit after paying back all of their
expenses.
Global companies
A global company is a company that can be recognised in multiple countries as a
corporation which produces and sells goods or services. An example of a film
company that is owned by global company is Warner Bros, they are owned by Time

2. Warner. Time Warner is a huge media conglomerate that has a variety of ventures in
loads of different markets. The advantages of being owned by a Global company are
that they an established company known worldwide because of the quality of the
products or services they produce. They also get given a bigger budget, which allows
them to use more known actors and have better stunts and special effects performed in
the movie. The disadvantages of being owned by a global company are that the
amount of profit made is reduced because a lot of the profit has to go back to the
parent company. Another disadvantage is that the subsidiary company doesn’t get
complete freedom to decide what they want to produce, they have to pitch it to the
parent company, and this means that if the parent company doesn’t like it they wont
get the funding for the production.
Monopolies vs. Oligopolies
A monopoly is when single company is the only supplier of a specific product or service.
This means they have control of a complete market and have no or very little
competition, which allows them to decide the price of the product or service they
provide. An oligopoly is when a few companies dominate an industry. An example of a
monopoly is sky’s control over pay- TV movie rights in the UK is restricting competition
which is leading to higher prices and reduced choice. The commission may decide to
restrict the number of Hollywood studies from which sky currently has the rights to be
the first to air their new releases. Sky has twice as many pay- TV subscribers as all its
rivals combined, this shows how extreme their dominance of the market is. An example
of an oligopoly is the major six, which are the six leading film studios. The major six
consist of Sony pictures, Warner Bros. Entertainment, The Walt Disney Studios, NBC
Universal, Fox Entertainment and Paramount Motion Pictures, which together are the
six major film making studios worldwide. Those six studios usually get to produce the
more popular films due to the fact that they have a bigger budget than all of their
competition. The advantages of being a monopoly are the supernormal profit, which
could be used to fund high cost capital investment spending. Another advantage is
increased output which will lead to a decrease in average costs of production. The
advantages of being an oligopoly are they have a strong hold over the market, which
allows them to be able to make huge profits because they have little competition.
Another advantage is the companies have the capability to decide the prices of the
product or service they remain dominant of; they also make a greater long term profit
which is usually maintained. The disadvantages of monopolies are poor level of service,
no consumer sovereignty, consumers may be charged high prices for low quality of
goods and services and the lack of competition may lead to low quality and out dated
goods and services. The disadvantages of oligopolies are the prices set for the
consumers may be unrealistically high, it will cause more small companies to fail, due to
the lack of competition the dominant companies may not consider improving their
product, it will make it harder for smaller companies to become successful, the smaller
companies will be left with smaller profits and companies won’t be able to make

3. independent decisions and will always have to consider the views of other dominant
companies.
Vertical and horizontal integration
Vertical integration is when a company owns companies in multiple stages. This allows them
to increase their profit; this also gives them the opportunity to make 100% profits. Horizontal
integration is when a company owns multiple companies in one sector, which can allow them
to dominate a sector, making other companies have to come to them. Walt Disney Studios is
an example of both vertical and horizontal integration. They own companies in multiple
sectors making them vertically integrated; they also own multiple companies in one sector in
the production cycle. An example of a company that they own in the same sector is Marvel
Entertainment. Due to the amount of companies that Walt Disney Studios own in different
and the same sector in the production cycle, they are a conglomerate, which gives them an
advantage over other companies because they have increased their amount of ventures.
Making more companies have to go to them to do certain parts of production and allowing
them to make more profit when producing their own movies. Advantages of being vertically
integrated is that they can reduce money spent on getting through certain areas of the
production cycle and the percentage of profit made increases, especially if the company owns
a company in every sector, that would allow them to make 100% profit. Advantages of being
horizontally integrated are that they can dominate a sector and force other companies to come
to them to progress in the production cycle. Monopoly could also take place which will mean
they can dictate the cost of progressing through a specific sector. The disadvantages of being
vertically integrated are increased bureaucratic costs, the decreased ability to be able to
increase product variety, lack of supplier competition and capacity balancing issues which are
having the capacity to provide downstream operations under demand. The disadvantages of
being horizontally integrated are the increased possibility of anti-trust prosecution, the poor
track record for maintaining innovation and potential collapse of organisation due to sector
downturn.
Sources
http://Tutor2u.net/economics/revision-notes/as-marketfailure-competition-monopoly.html
http://en.wikipedia.org/wiki/Major_film_studio
http://www.economicshelp.org/microessays/markets/advantages-monopoly/
http://www.buzzle.com/articles/advantages-and-disadvantages-of-oligopoly.html
http://www.dineshbakshi.com/igcse-gcse-economics/private-firm-as-producer-andemployer/revision-notes/1306-monopoly