Ownership and control: blog task

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

the reason Facebook purchased Instagram is to have wider audience. the people using Instagram would also use Facebook.the revenue from Instagram would come back too zuckerberg thus leading too an increase in total revenue. another reason would be too decrease competition.


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

decreased cost of production thus more profit 

profit == revenue - total cost of production 

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

wider range of audience thus more profit, decreases risk because if on business looses interest of consumers then there are multiple paths of income.

4) What is a subsidiary?

a smaller company owned by a larger one.

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).

Disney owns marvel which is a brand 
pepsico owns lays which is a brand of crisps, this is a good synergy because of pepsi being a brink and lays a snack brand 
and fox studios are all examples 

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

hulu, sky ,national geographic, abc ,marvel, marvel studios , espn, star wars ,fox pixar 

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

 Disney bought fox too expand its self and to maximise profit due too the synergy  this would also decrease competition it also increase audience size increasing the total number of consumers thus increasing demand for Disney products.

demand == the willingness and ability to purchase and good or a service .   

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