Horizontal Integration

 Horizontal integration occurs when a firm is being taken over by, or merged with, another firm which is in the same industry and in the same stage of production as the merged firm.

AOL Time Warner, the Walt Disney Co, Viacom and News Corporation are a few of the top leaders in media. They produce the majority of what we watch, read and talk about in the media today. These companies all strive to give the world media attention from the time they wake up until the time they go to bed at night. They are able to reach millions of people all over the world. History was made when in 2001 when AOL and Time Warner merged together to produce the World’s largest media company. To explain why companies want to merge together is like thinking of two different salesmen, one man is selling toothbrushes and the other is selling toothpaste. You can make more money teaming up with your opponent if you sell the toothbrushes and toothpaste together than separate.

Time Warner is a huge company that is a top leader in media production. While reading chapter 2 in our media literacy I learned that media collaboration is a process that requires the input of numerous people. The producer is chief, then there’s the script writer, the director of films, cast members, production managers and so on. The Time Warner Company has over 38,000 employees and about a 100 subsidiaries. They own almost every show on T.V today. There subsidiaries range from Warner bros. line of family entertainment, Turner Broadcasting,   people magazine, HBO channels, Reprise Records, and a Time magazine. To be an effective media communicator we must look at who is responsible for creating the media production?What are the demographic characteristics of the media communicator(s), Such as age, income, race and gender? How do these characteristics affect the content and outlook of the media production? 

Time Warner has mastered the ability to target their viewers and expanded on ways to hold their attention and interest in the company. The Harry Potter movies have surpassed $1 billion dollars in the Box Office for the ninth consecutive year. Harry Potter is just one investment Time Warner Company owns.  They are way more than just a collection of great brands under one roof. 

This business strives to gain competitive advantage from opportunities for constructive collaboration. Concentration has many good aspects for a billion dollar company like Time Warner, but it can also bring about bad aspects as well. Some people argue that concentration is a problem. They believe that concentrated media will give audiences what they or because owners, will have little long term ability to deviate from market dictates. These ideas have increased policy makers’ recent inability to understand non-economic concerns with the media concentration. With the good or bad aspects Time Warner states “Whether measured by quality, popularity or financial results, our divisions are at the top of their categories.”