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Vertical & Horizontal Integration

Richard Gent | Tuesday July 19, 2011

Categories: Key Concepts, Institutions, Censorship & Regulation, Ownership, New Media, Integration, News, News Ownership

Vertical Integration

Commercial institutions try to combat the power of the BBC by becoming larger and creating vertical integration. This is where an institution has shares or owns each part of the production and distribution process. For example: Warner Bros Entertainment calls itself a fully integrated broad based entertainment company which owns film studios and the means to distribute the films as well as some of the cinemas in which they are shown. Warner Bros in itself is part of an even bigger conglomerate called Time Warner which is a huge media conglomerate institution which uses horizontal Integration to consolidate its power and profits.

BBC | Dragons’ Den Definition:

A situation when two firms in the same industry but at different stages of production come together.

This could be through the two businesses merging together or through one firm taking over another.

For example a baker could buy a wheat farm or a television studio may buy up a production company which produces some of its television programmes.

Horizontal Integration

Horizontal Integration is where an organisation develops by buying up competitors in the same section of the market e.g. one music publisher buys out other smaller music publishers.

BBC | Dragons’ Den Definition:

A situation when two firms in the same industry and at the same stage of production come together.

This could be through the two businesses merging together or through one firm taking over another.

For example two chocolate companies or two estate agents may decide to join together.

Time Warner describes itself:

Time Warner Inc. is a leading media and entertainment company, whose businesses include interactive services, cable systems, filmed entertainment, television networks and publishing.

‘Whether measured by quality, popularity or financial results, our divisions are at the top of their categories. AOL, Time Inc., Time Warner Cable, Home Box Office, New Line Cinema,...


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