Ownership concepts:
There are 2 types of integration in the TV industry, horizontal and vertical. Horizontal and vertical integrations are strategies used by businesses in the same industry or production process.
Horizontal integration:
When a company undergoes growth through horizontal integration, the aim is to obtain a similar company in the same industry.
Companies may choose to undergo horizontal integration in order to increase their size, diversify product or services offerings, achieve economies of scale, or reduce competition. They may also aim to gain access to new customers or markets, including overseas. For example, a department store may choose to merge with a similar one in another country to start operations overseas.
The result of horizontal integration, when successful, is the ability to produce more revenue together compared to if they were to compete independently. Examples of horizontal integration include Facebook's 2012 investment of Instagram, and Disney's 2006 accession to Pixar.
Companies may choose to undergo horizontal integration in order to increase their size, diversify product or services offerings, achieve economies of scale, or reduce competition. They may also aim to gain access to new customers or markets, including overseas. For example, a department store may choose to merge with a similar one in another country to start operations overseas.
The result of horizontal integration, when successful, is the ability to produce more revenue together compared to if they were to compete independently. Examples of horizontal integration include Facebook's 2012 investment of Instagram, and Disney's 2006 accession to Pixar.
Vertical integration:
A company that undergoes vertical integration acquires a company that operates in the production process of the same industry.
Some of the reasons why companies choose to integrate vertically include strengthening their supply chain, reducing production costs, making sure no other companies make profit, and to keep control.
This type of integration when successful, guarantees efficiencies in the production process, and cuts down on delays in delivery and transportation. Examples of vertical integration include Warner Productions conglomerate.
Some of the reasons why companies choose to integrate vertically include strengthening their supply chain, reducing production costs, making sure no other companies make profit, and to keep control.
This type of integration when successful, guarantees efficiencies in the production process, and cuts down on delays in delivery and transportation. Examples of vertical integration include Warner Productions conglomerate.