Media Ownership Influences

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To identify the impact of economic imperatives on the globalization of media.

practice using critical thinking skills to evaluate influences on media content.
Background:
Originally, mass media ownership was relatively decentralized, with nearly every city hosting its newspapers, radio stations, and even television stations. Over time, consolidation and mergers led to the rise of large media conglomerates fueled by the deregulation of media ownership restrictions with the Communications Act of 1996. This led to a handful of major corporations exerting significant control over multiple media outlets and across various platforms. Comcast, Disney, AT&T, Sony, Alphabet, and Meta are just a few of the major media companies in the United States and globally.
Activity:
A. Before you tackle this assignment, read Chapter 12 and Sections 13.1, 13.2, and 13.4 of Saylor’s Understanding Media and Culture.
B. Then, choose a news media outlet, such as The Washington Post or CNN, and visit its website to determine its parent company. Often this will be in the “Corporate” or “About Us” sections.
C. Consider and respond to the following questions:
1. Which of the three basic media business models does this media outlet fall into?
2. How does this media outlet employ each of the two ways that media receive revenue?
3. Does it exclusively use one way or a blend of the two?
4. How large is the parent company of this media outlet? Does it own any other outlets?
5. How might the parent company be using vertical integration to its advantage? What about horizontal integration?
6. Were there any surprises to what you found? Were there any corporate connections that you did not expect to see? Explain.

Sample Solution

Analyzing CNN’s Media Model and Corporate Ownership

CNN’s Business Model and Revenue Streams

CNN primarily operates within the advertising and subscription business models.

  • Advertising: CNN generates revenue through advertisements, both traditional commercials and digital ads. These ads are strategically placed within news broadcasts, on the CNN website, and across various digital platforms.
  • Subscription: CNN also offers subscription services, such as CNN+, which provides exclusive content and ad-free viewing. This subscription model allows CNN to generate revenue directly from consumers.  

CNN’s Parent Company and Integration

CNN is owned by Warner Bros. Discovery, a massive media conglomerate. This ownership structure enables CNN to leverage the resources and capabilities of its parent company.  

Vertical Integration: Warner Bros. Discovery can vertically integrate by owning various stages of the production and distribution process. For example, they can produce news content, distribute it through cable and satellite providers, and stream it on their own platforms. This integration allows for greater control over content and distribution channels.  

Horizontal Integration: Warner Bros. Discovery can also horizontally integrate by acquiring other media companies, expanding its reach across different media platforms and markets. This strategy allows the company to diversify its revenue streams and reduce competition.  

Surprising Corporate Connections

While CNN’s ownership by Warner Bros. Discovery is well-known, the extent of its parent company’s holdings might be surprising to some. Warner Bros. Discovery owns a diverse range of media brands, including HBO, Discovery Channel, HGTV, and Turner Classic Movies. This extensive portfolio allows for cross-promotion and synergies across different platforms.  

In conclusion, CNN’s business model is a combination of advertising and subscription revenue, leveraging the power of its parent company, Warner Bros. Discovery. The company’s strategic use of vertical and horizontal integration allows it to maintain a strong position in the media industry.

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