Read this article from Recode about Facebook’s acquisition of Instagram and complete the tasks below:
1) Why did Facebook buy Instagram for $1bn in 2012?
This is because Instagram had 30 million users and later when Facebook bought The company, thanks to Facebook Instagram now has 600 million users and it will late progress to become a multi-millionaire company.
2) What are the benefits for media companies of vertical integration?
when the company then makes a chain link it then the company that buys it then starts to have complete ownership of the company which then results in the producer making more money
3) What are the benefits for media companies of horizontal integration?
When there is another company that buys the other company the producers may sometimes have things that they didn't have for example if the company didn't have any CGI producers then the company that they now have bought they can now have those kind of specialists, this can also make it so that it grows and builds in size and power this can make the company they bought they make their selves more able to get more money
4) What is a subsidiary?
A subsidiary is a small company that can be owned by bigger companies called conglomerate
5) Give three examples of media companies that have used synergy to maximize the profit from a brand (there is one above to help you).
Disney, Facebook and Warner bothers
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: Marvel, 21st century, ABC, hulu, sky, lucasfilm, go pro, pixar ESPN,Hollywood records, vice media
7) Why did Disney buy Fox - what are the benefits?
The benefit for this was that Fox had already owned different types of things that include Television, Filmed entertainment, Cable network etc. so this makes it so that they can own more money and make more faster this is by how Fox have already co-operated with a different things and so that they now have gained a massive amount of money so if you add the amount of money that Disney have made then you add the amount of money that Fox have already gained you can see that they have combined to make one big company, this makes it so that Disney can now show their content on television worldwide as Fox is a television company so this makes things more convenient for Disney to display their content to others around the world.
The benefit for this was that Fox had already owned different types of things that include Television, Filmed entertainment, Cable network etc. so this makes it so that they can own more money and make more faster this is by how Fox have already co-operated with a different things and so that they now have gained a massive amount of money so if you add the amount of money that Disney have made then you add the amount of money that Fox have already gained you can see that they have combined to make one big company, this makes it so that Disney can now show their content on television worldwide as Fox is a television company so this makes things more convenient for Disney to display their content to others around the world.
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