Ownership and control

1) Why did Facebook buy Instagram for $1bn in 2012?

They bought Instagram as they wanted to expand their business and to cancel out the competition.

2) What are the benefits for media companies of vertical integration? 

The companies can make more profit if they have an ownership with other companies and maintain control of the products.  

3) What are the benefits for media companies of horizontal integration?

It allows companies to widen their audience and find other ways to make money. Also  if one company goes out of business you will still be making money as you'll still have other companies.  

 4) What is a subsidiary?

It is a smaller company owned by a larger company.

5) Give three examples of media companies that have used synergy to maximise the profit from a brand (there is one above to help you).

 Harry potter- Theme parks, concerts and merchandise.
Star wars- merchandise, soundtracks and events.
Marvel studios- soundtracks, events and merchandise.   


6) Read this BBC article on Disney buying 21st Century Fox. List 10 companies that are part of the Disney media empire. This graphic may help you:

ESPN
Marvel studios
Lucas film
Pixar
Dreamworks
The Muppets studio
ABC entertainment
Hulu
A+E cable channel 
ABC news and radio

7) Why did Disney buy Fox - what are the benefits?

Disney bought fox to expand their global reach, widen audience and make more money.