Ownership and Control

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

Facebook bought Instagram in 2012 in order to decrease the chance of Instagram overtaking them in the near future. At the time it didn't seem like a good decision but now, it appears as 'genius'.  

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

The benefits for media companies of vertical integration are that they have complete control which also means that they make more money.

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

The benefits for media companies of horizontal integration are that the risk of the company going out of business is lower due to having less rivals. They can also reach a wider audience and if one company does fail the rest of the company doesn't go down with it.

4) What is a subsidiary?

A subsidiary is a small company that is owned by a conglomerate that is made up of multiple subsidiaries. 

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).

3 Examples of media companies that have used synergy to maximise the profit from a brand are: Frozen, BigHit Entertainment and Kyoto Animation.

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

10 companies that are apart of the Disney Media Empire are: Hulu, Marvel, Pixar, Dreamworks II, Disneyland Paris, The Muppets Studio, 

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

The reason why Disney bought Fox was because by owning Fox which is a company in the same chain of production means that Disney has the chance to make money at each stage of the production and have complete ownership over Fox.