Sony is classified as a convergence industry because it operates across multiple sectors including film production, television hardware, music production, music distribution, and gaming. Sony uses synergy across its business sectors to increase profits. For example, with Spider-Man, Sony was able to profit from the film, soundtrack, game, DVD, and merchandise. Synergy provides advantages like reducing risk through diversification and reaching wider audiences. However, synergy can also be difficult to achieve in practice and lead to job losses or oligopolies.

1. Convergence Industry
What is a convergence industry?
How can Sony by classified as a convergence industry?

2. Convergence Industry Diagram
SONY
Film Production
Sony PicturesTV hardware
Bravia
Film Consumption
HDTV
Blu-ray
Music Production
Music Consumption
Music Distribution
Gaming
Acid Music Studio 7
Jive Records
In your notes you should have a completed copy of this diagram

3. Synergy
What is Synergy?
- Read through Case Study 2: Sony Synergy handout.
- Read through Music and the entertainment industry handout.
Highlight the advantages and disadvantages of Synergy.

4. How are these film examples of
Synergy?

5. Sony Synergy - Spider-Man
Film - Sony Pictures
Soundtrack - Sony Music
Entertainment
Game - Playstation2, PSP
DVD - Blu-ray
- Joint Venture with Marvel Comics
- Other Merchandise - toys, clothes,
posters all promote the film and
benefit Sony financially.

6. Sony Synergy - Casino Royal
Institutional Involvement
Produced by MGM and Columbia Picture
(Sony Subsidaries)
DVD distribution by Sony Pictures
Available on Sony blu-ray
Soundtrack on Sony Classical
Product Placement
Sony Ericsson Phone
Sony Cyber Shot Camera
Sony Vaio notebook / laptop

7. Evaluation of Synergy
What are advantages and disadvantages
of synergy?

8. Advantages of Synergy
Companies like Sony can spread their commercial interests.
Diversification means a reduction in risk.
Increase profit of each separate medium.
Enhances company’s image.
Can reach shrinking audiences with diverse tastes.
Influence public opinion.
Dominant a variety of markets.
Sharing skills between two companies and exploiting strengths
(Sony and Marvel, Sony and Ericsson, Sony and 3 Mobile).

9. Problems with Synergy
Easier in theory than in practice. Different companies
may have different ideas.
Can lead to loss in jobs. Sony laid off 19,500
workers last year.
Merging together to exploit strengths or sharing risk?
Smaller companies who only specialise in one medium
struggle to compete.
Leads to oligopolies - uneven distribution of power.

10. Essay Question
Discuss the importance of cross media convergence
and synergy in an industry you have studied.
Write a plan for this essay question.
Include the key points of each paragraph.
Include what key terminology / examples you are going to
include.