Vertical Integration

     Vertical Integration is when a Media corporation or company owns different businesses and companies that are all in the same chain of production and distribution. Every prominent tv production or streaming service you see today is all a chain of production, owned and produced by a much larger corporation. Ultimately, almost all of media is owner and run through 6 large corporations: Comcast, Newscorp, Disney, Viacom, Warner Bros, and CBS. In fact, these “companies control a staggering 90% of what we read, watch or listen to” (mattdgp). 

    “When a company expands its business into areas that are at different points on the same production path” (AS Media), such as when a manufacturer owns its supplier and/or distributor they control the market for that thing. “Vertical integration can help companies reduce costs and improve efficiency by decreasing transportation expenses and reducing turnaround time, among other advantages” (AS Media) such as companies not having to rely on suppliers, which ultimately reduces costs. It also leads to a boost in the economoy, however this results in more expensive and less cost efficient things for the consumer, because companies can run up and make prices in media however they want. With streaming services, they can just increase the cost per month whenever they want, and force people to either leav or pay more. A lot of times they own other streaming services though, whoch can make things bad/complicated for the consumer.  

    One of the more prominent examples of Vertical Integration in television is 20^th Century fox which produces its own tv shows and movies, but also has its own subdivion of channels, such as: FX, FXM, and FXX which are affiliated by the Fox Broadcasting channel. Another good example is Warner Bros. who owns Time Warner who has subdivisions through it such as HBO and the CW, and the rights to DC.

    One way that these big companies benefit from it, especially with today’s streaming services is the moving of movie productions to an individual service, that is ultimately owned by the same corporation. Especially recently, many companies are pulling tv shows and movies of Netflix and are using it to start their own or adding it to their own streaming services. This allows companies to charge consumers more money to buy a another streaming service to watch a program that was previously available on a different platform.

    This has a bigger impact than just streaming services too, for example, if Disney were to have a scandle or something of the sorts, or a big hit or production. They control the news coverage of ABC since it is a chain and production owned by Disney. This can be dangerous, as bigger coprorations like this can censor the consumer from what they don’t want them to see, and push forward with a potential agenda or bias that they want people to see, or Newscorp for example that owns Fox, the New York post, and the Wall Street journal, can control an entire news cycle through 3 massive News companies that are big part of the news cycle. 

    Overall, it is important to understand Vertical Integration, as almost all of the media consumed today is run through this. There are 6 main corporations that own almost all media, and therefore control what media is being put out there for the consumer. It is very important to realize this, and not always rely on the big company and corporation for media. 

 

https://www.thebalance.com/what-is-vertical-integration-3305807

https://www.ghjadvisors.com/blog/vertical-integration-in-the-entertainment-industry-and-its-impact-on-profit-participations

https://mpwasmedia.wordpress.com/vertical-integration/