What are the operating structures of media companies?

Horizontal and Vertical Integration

The way in which a media conglomerate is structured that can maximizes profits. 

Vertical integration is when a conglomerate has ways to do all 4 of the following ways perfectly to maximize profits as they don't have to pay anyone to do it for them:

• Production- The making/manufacturing of the product 
• Marketing- The advertisement of the product
• Distribution- The way in which the product is then shipped out and sold 
• Consumption- The way the product can be used. 

For a conglomerate to maximize profits for this is having their own factories for production, to have people who can make an advert without having to pay someone else to do it for them, having lorries and boats for the distribution so they can get the product to the customer themselves and to have their own devices for the product to be used for example if it was a game then a console that was supported by the game.

 Horizontal integration is a process of a company increasing production of goods or services at the same part of the supply chain. A company may do this via internal expansion, acquisition or merger. The process can lead to monopoly if a company captures the vast majority of the market for that product or service. 

A Monopoly happens when a single company/conglomerate owns the whole of something with no competition in a single area leading to the company being able to set prices that cant be argued as there is no competition. 

The different things that a company has to be in control of for horizontal integration to take place is:

• Online/social media
• Print media and advertisement
• TV and radio
• Merchandising

When a conglomerate uses all available subsidiaries to promote and distribute a product this is called Synergy, this is enabled by Cross-Media ownership.