Tuesday 5 April 2011

Horizontal and Vertical Integration

Horizontal Intergration

Horizontal Integration is a Media Company's Ownership of several bussinesses of the same value. A Media Company can own a Magazine, Radio, Newspaper, Television and Books. Almost all Media companies have horizontal intergration. It helps to create more money and makes the company more popular amongst readers. Also, not all media readers prefer reading magazines. The more technology litterate people will read the magazine online, so horizontal intergration helps to reach a wider audience.

Vertical Intergration

Vertical Intergration is when a Media Company owns different bussineses in the same chain of production and distribution. For example, a 20th Century Fox owns the studios in Hollywood, they also own the cinemas, the tv channels and the DVD rental shops. They own parts of chain so that they can make money from evry part of it.
In terms of the magazine industry, They own the Forests where their resources come from, in this case, the paper. They also own the buildings where the magazines are designed, they own part of the publishers, and the newsagents where the magazines are sold.