As a researcher for COGENT MEDIA, I have been asked to produce a report on ownership and funding. What I would like achieve from these reports is that I would like to learn how the TV and film industries are structured to make these films and TV shows. The report that I am making will explore ownership and funding that is used in the TV and Film industry. The report will be done by analysing Chanel such as ITV Channel 4, Film 4 and BBC. I will also be analysing some film production companies such as: Universal Studios, 20th Century Fox and Warner Bros as case studies. These two industries have developed a lot over the past 50 years, when the television was invented in the 1950s.Since then the television and the rise of the internet era in the nineties the two industries have had to adapt to what the audiences have demanded from them because of the growing interests people were having in these two industries.
Ownership
Public Service
Public
service is when a television or a radio broadcasting services provides their
services with the intention not to be making a profit from the public. This
means that the public does not have to pay for that TV channel or radio station
as it is free. Companies that provide public service broadcasting make their
money by only showing programs that they made. Other things that public
services get their funding from are things like the license fees, individual
contributions, commercial financing and Adverts. Other places where public
services get their funding from include government schemes that give them money
to shows these programs. This is because they do not get any money from things
such as commercials. PBS is a public services broadcaster and they are a little
bit different from other public service broadcasters because they get their
money from their viewers. What happens is that their viewers give them
donations to keep on airing shows; they also get funds from their government. The
main reason that people make these programs is because private companies that
broadcast shows are not interested in making these types of programs so they
make them and get the funding from their government. The types of shows that
they make include as educational children's shows, documentaries, and
public affairs shows about current issues. Examples of companies that have public service broadcasting
include things such as BBC in the UK, PBS in America and NHK in Japan.
The BBC is an example of a company
that does public service. This is because the BBC is not run for profit and it
airs it shows for free to users of a TV. The BBC stands for the British
Broadcasting Corporation. The BBC does
not only broadcast to the British people, it is a worldwide company that
broadcasts internationally around the world. The way the BBC gets it’s funding
is that they get the money from people who have TV that pay their TV licence.
In some way it is not free. Since the BBC is not run for profit they are not
allowed to show commercial which is a source of income that the BBC miss out
on. The reasons the BBC is allowed to broadcast is because they are placed
under the Royal Charter, which is a legal document that gives rights to
organisations to do a certain thing. In this case the BBC is allowed to
broadcast.
Private
Ownership
As well as public
service broadcasters there are also private ones. These are companies that also
broadcast television and radio programs. Private ownership is the broadcasting
of television programs and radio programs by privately owned companies, these
companies broadcast privately because they do not get any funding from their
customers or the government, so they get their money from commercials. The
commercials are adverts that are shown by the private company whenever the
program that is on the channel goes to an ad break. To find the commercials
what they do is that they tell other companies that have something to advertise
and tell them that they have a slot open at a certain time and how much it
would cost at that particular time.
An example of a privately owned film company
is Warner Brothers. Warner Brotehrs is a company that make prodcutions suhc as
films and music video. Warner Brotehrs have their own record label and some of
the artists that are currently signed with them are Outasight, Bridy and Red
Hot Chili Peppers. Warner Brothers are most famously known for their film
Looney Tunes. Whilst making films they also own copyright to the fim series of Harry
Potter, Batman and Superman.
They are also most famously known for their
logo:
Commercial Ownership
Commercial ownership
is when companies broadcast shows and programs on their channel privately with
the aim of making a profit from people paying for their channel. The main purpose of having commercial ownership
is to air radio and television advertisements for profit. This is because
commercial broadcasting does not get any funding from people like the
government. Commercial broadcasting is the opposite of public service because
public services get funding from the government. Commercial ownership goes into
the same place as things like cable TV, Radio and satellite TV, these services
are either public paid or paid by local subscribers. Programs that are
broadcasted commercially are more ratings driven, this means that the more
ratings a program gets the more money the program gets.
Examples of commercially owned TV companies are is
ITV. ITV is commercially owned because they are paid to show some adverts on
their channel and they are not government funded so they are owned by a private
media corporation.
Corporate Ownership
Corporate ownership is one of three different
types of ownership, the other two are sole ownership and partnership. In a corporate ownership
one person owns all the shares of the company, but they are not responsible for
what happens to the company, this is because at the company, if the person that
owns all the shares dies then the company does not have to be terminated. This
is different to sole partnership where the company becomes terminated when the
owner dies, unless the company can be inherited to someone else.
An example
of a company that is a corporate ownership is Viacom. This is because Viacom
owns theatres in Canada and other places around the world. Viacom is short for
Video and Audio Communications. Viacom is an entertainment company that was
made in the 1970s as a part of the CBS television. Viacom now owns CBS as well
as Paramount Pictures, Blockbusters, Spelling Productions, MTV and more.
Independent Ownership
Independent ownership is when
a company is owned by one person; sometimes this is called a sole ownership.
This is when one person owns the company and that one person has full
responsibility for whatever happens to the company. If that person dies then
the company would have to be terminated and whoever worked for the company
would lose their job. The only way this can be avoided is by the company having
someone that can inherit the company. In an independent ownership the company is private unlike
the public companies.
An example of an independently owned company is the Walt Disney Company.
This is because the Walt Disney Company is owned by Walt Disney. The Walt
Disney Company is one of the biggest entertainment companies in the world. The
Walt Disney Company was started by brothers Walt Disney and Roy Olive Disney.
It was first called the Disney Brothers Cartoon studio until 1937 where they
decided to change it to Walt Disney Productions.
Vertical Integration
Vertical Integration is when a film company owns a
film and on that film they are in full control of what happens with the film.
An example of this is distributing and
exhibiting the film. Some producers think that using Vertical
Integration is the best way to produce the films. This is probably because in
this way if the film is successful then the producer would get more money than
they would normally get and they would also get more credit. Vertical
Integration companies use their own cinemas to show their films, an example of
a Vertical Integration company is Disney. It is good for a company to have
Vertical Integration because if they do it would mean that they would be profiting
from everything, this is because they would already be profiting from the film
itself, they would also profit from the money they make from their cinema.
It is not only films that use Vertical
Integration; it is also TV as well. This is because on the BBC channel they
show their own shows and programs. For example all the shows that are shown on
BBC are ones that they have made. EastEnders is a show that has been on the BBC
for a very long time and it was made by the BBC. At the start of each
EastEnders program they show their logo and beneath it, it shows the BBC
logo.
Horizontal Integration
Horizontal Integration is when one company own a lot
of companies that work together and they work together to make the same thing
such as a film. The main reason people use Horizontal Integration is so that
they can take over similar, but smaller, companies that they can use to help
them with their project, that project can be anything include films. An example
of a film that was made by a Horizontal Integration company is Titanic. The
reason Titanic became a film by Horizontal Integration was because it was meant
to be a vertical Integration film, but they went above their budget so they had
to ask for help from other companies to come in and help them make this film.
Funding
There are many ways a company can get their funding;
some of these places where the companies get their funding include things such
as the licence fees which is when a company gets paid by someone to have their
show on their channel, subscription, pay per view and others.
License Fees
Licence fees are fees that tax payers and people who
television have to pay the company that are showing the programs on the TV. The
reason people pay for TV license fees so that if they pay the company have to
follow certain rules that were made. Some of these rules include things such as
having to cater for all audience; this means that at times they have to show
programs with audio for the blind at time. The licence fees are a way for a
company to get their funding so that they can put the money into other things
for their company. It is a law for people to pay their license fees and if they
don’t they could get into trouble with the law.
Subscription
Subscription is when a customer and a company get
together and agree on a deal that would see them subscribe for something. These
things can be packages and with these packages they would get things like the
ability to pause, rewind and play channels as you would do on a DVD player.
There are many companies that give this offer and companies such as Sky and Now
TV are ones that offer this option. Subscription channels are channels that
people subscribe for and pay to have them installed onto their TV. With Sky
their customers can have the option to have the regular channels for how much
they would normally pay, but if they want to spend a little bit more, what they
would have to do is subscribe for a package. These packages can be anything
such as sports, film or documentaries.
Pay Per View
Pay per views is another form of funding for
companies that make things such as films and programs. This is another form of
funding because what this means is that they can get money for each time one of
their customers watches a show. This can be calculated by each time a customer
watches one of their shows.
Sponsorship
Sponsorship is when a company gets sponsored by
another company to make the film. This is another source of funding because it
means that the company would get some money from whoever is sponsoring them. If
a company gets sponsored by another company there are usually things the
company has to do for the other company. These things can include things such
as putting the logo of the company somewhere in the film. This is because if
the company’s logo is in the film and the film becomes a hit and a lot of
people watch the film they would see the logo and wonder what they do and maybe
even buy something from them.
Advertising
Advertising is a form of finding for film companies
because when a show is on a TV channel they usually tend to go on ad breaks,
this is when the advertising is shown. Companies can make money from advertising
because they could get people to pay them to have that ad shown on their TV
channel. Depending on the time a advert is being shown also depends on how much
money someone is willing to pay for their ad to be shown. An example of a time
that it would cost a lot to show an advert is around the evening when the
families are sat around watching the TV. An example of when it would be cheap
to show an ad is at one O’clock in the morning. Companies can book slots on a
TV channel Schedule so that when a program is on and it goes to an ad break
they can say we want that slot.
Product Placement
Product placement is an advertising
technique that is used by companies to advertise their products. The technique
is where the company place the product, for example when England are play Spain
and a company decide to put their advertisement on when it goes to half time,
more people are more likely to see it than if they put it on at another time.
Another place a company can put their product to be advertised is at the cinemas,
they can put the advert before film starts. When this happens the company
usually has to pay a fee to the owner of the company. Depending on when the
film was released would depend on the price.
Private Capital
Private capital is a source of external
finances for business. If a company use private capital as a source of funding,
it is because they are trying to avoid the traditional way to start a business
which is taking a loan from banks. Private capital usually comes from private
investors that fund companies to start up a business and when the business starts
to make money they would be getting money form the company. If a business that
is starting up a company and they need some money, but they don’t want to get
it from the bank, what they can do is that they would have to have a written
agreement of some kind. This agreement would probably say how much they are
giving and how much they should get back once they have started up their
business.
Financial Aid
Financial aid is a way for a company to get help
with their financial problems. The help can be things like extra funding from
their company because they do not have enough money. The people that would need
the financial help are usually the film crew. This is because they might have
gone over their budget limits and they need to get more money to finish the
film. The financial help usually comes from people investing in the film and
the reason people might invest in the film might be because they would think
that he film would be making a lot of money in the cinema so they would decide
to invest because they would be making a good profit from the film.
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