Types of structure Vertical Vertically integrated companies are

Types of structure

Vertical • Vertically integrated companies are owned by one owner in a chain. Usually each member of the supply chain produces a different product or service, and the products combine to satisfy a common need.

Apple • Apple is an example of vertical integration where they control the processor, the hardware and the software.

Vertical expansion • Where a large company like Apple buys smaller companies who will develop their business. I. e Apple might buy an app development company as it will help to develop their own apps or a LCD company so they can make their own screens for their IPAD’s. • News Corps brought a company called Direct. TV is a satellite TV company. The reason for doing this is so News Corporation can distribute more of its media content: news, movies, and television shows.

horizontal • Horizontal integration occurs when a firm is being taken over or merged with another firm which is in the same industry and in the same stage of production as the merged firm, e. g. a Movie studio merging with another studio. The goal of Horizontal integration is to consolidate similar companies and monopolize an industry.

Media consolidation • This is why there are only 5 main media companies in the world because they have consolidated i. e been taken over and merged.

Cross media regulation • There are certain rules which mean that not one company can own too much on the media industry and there has to be room for competition. OFCOM is in charge of rules about mergers and acquisitions. • OFCOM is also in charge of giving channels licences. Look at how News Corps tried to buy SKY.