Chapter 2: The Media Business Environment: Markets, Business Models, Mergers, Alliances, and Partnerships

Electronic and Digital Media Markets

Market Structure

Business Models

Forces Affecting Markets

Alliances and Partnerships

Implications for Management

Market: A place where consumers and sellers interact.

Consists of buys and sellers. The buyers would be consumers who purchase products (Radios, Antennas, Subscriptions, Cable packages.) The Sellers would be Telecommunication providers, cable companies, Individual Stations (Radio/Television.)

How these Markets are used: The providers advertise their products to reach a certain demographic that would consume their products.

Examples: Television Commercials, Radio advertisements, On-air sponsorship.

4 Main Types: Monopoly, Oligopoly, Monopolistic, Competition

Monopoly: One seller that dominates.
Oligopoly: Three or more sellers of a product each holding a similar share.
Monopolistic: Many sellers offering similar products that are not perfect substitutes for one another.
Perfect Competition: Multiple Sellers and a homogeneous product characterize, no single firm dominates.

Models of business: Advertising, Business to consumer, Subscriptions, Consumer to Consumer, Freemium.

Strategic Alliance: An association designed to provide benefits for each of its members. Example: Organizations sharing capital and cost, providing access to new markets, increasing shareholder value and reducing risk. (Mergers/joint ownership/ joint ventures.)

Company partnerships to share production and distribution costs.

Newsgathering: Companies share information to each other that way they all release information at the same time.

Examples of Mergers: Comcast and NBC.
21st Century Fox.
Media General and LIN.
AT&T and DirecTV.

Economic Conditions: If no money to be spent, than sellers cant make money off consumers

Technological Forces: With industries evolving it may effect the way products are sold. Example: Present day free streaming services have made it harder for sellers to make money off their services.

Regulatory Forces: Government creating new laws on consumption may also hurt sellers or buyers. Examples: Some laws have made big companies even bigger and made it harder for independent companies to get their products to consumers.

Global/Social Forces: With the United States markets saturated with 99% American Companies it makes it hard for Global media markets to produce news for the states. Social these companies look toward rich instead of stories that would effect the poor.