Ownership and Funding

In this assignment, I am going to be investigating ownership and funding within the TV and Film
industries. In order for me to collect a wide range of ownership and funding patterns, I am
going to consider; a public service broadcaster, a commercial television broadcaster, an
independent production company and a global media empire that includes film production.

A Public Service Broadcaster BBC

The BBC stands for British Broadcasting Corporation and is a UK based international public
service broadcaster. It was founded by John Reith on 18th October 1922. The BBC isnt
actually owned by anyone in particular but is actually owned by the British public since it is a
public service broadcaster. The BBC also doesnt have any advert breaks because the
broadcaster is funded by an annual television licence fee that every British household,
company and organisation have to pay if they use any type of equipment to receive live
television broadcasts. This licence has been around since 1946 and originally started at 2,
which paid for the single, monochrome, channel then being broadcast. Then in 1968, BBC2
and colour broadcasting was introduced but at a fee of 5. The current licence fee is 135.50
a year or 11.29 a month however, this includes all of the channels and the radio stations.
This means that there is no need for adverts since they are already funded for. The way that
the BBC spends the funding is by prioritising the majority of the money towards the bigger
channels (BBC1 and BBC2) and then spending smaller amounts on their radio stations and
digital channels.
The BBC demonstrates vertical integration. Vertically integrated companies are a group that all
produce different products and services, however they share a common owner. Vertical
integration means that there is a merger of companies at different stages within production or
distribution that are in the same industry. The reason why the BBC is an example of vertical
integration is because the BBC is one big broadcasting industry, however, there are many
different BBC services within this huge broadcaster. For example, there is more than one BBC
channel and they have a lot of different productions going on within each of these channels.
On BBC One they have lots of productions going on, such as the News, Weather, Sport,
Movies and many different programmes. Now, they also have BBC iPlayer and international
TV channels to interact with people all over the world.
In my opinion, the BBC can have quite a good influence on its audience because the majority
of things that they show on the BBC channels have quite an education value, especially BBC 1
and BBC 2. This definitely has a good influence on the audience and it also has a good
influence on children because their channels; Cbeebies and CBBC only ever show
programmes that have some sort of educational purpose. However, the way that the BBC
works and the way that it funds has already created a lot of debates whether the licence fee is
archaic and that it isnt good value for money. This on the other hand isnt creating a good
influence within the public. Many people think that the licence fee should be demolished
because a lot of people dont actually watch much of the BBC and paying money in order to
keep it running is seen as unfair and they could just find other ways to fund it. Also this doesnt
have a very good influence of the other broadcasting companies, because the BBC are able to
be funded by the general public however, they have to fund their company by themselves,
using commercial breaks. This is quite unfair to the other broadcasters because the public
have to legally pay for the BBC to keep running, whereas, all other companies have to fund it

by themselves. Some people believe that Public Service Broadcasting is impartial and
objective and balances out any potential bias in the private sector.

A Commercial Television Broadcaster -ITV

ITV is a commercial TV network in the UK and it launched in 1955 as Independent Television
under the auspices of the Independent Television Authority. This was done to provide
competition for the BBC.
Since ITV is an example of independent television, the broadcaster is owned by themselves.
The ITV network is to be very successful from ITV plc (Public Limited Company), which is the
company that resulted from the Granada plc and Carlton Communication emerging. The ITV
plc is also what holds the broadcasting licenses for Channel 3. Channel 3 used to be the name
because number 3 was the number that people would have to select on their televisions to get
on the channel, however ITV took over the channel and renamed it to ITV.
Since IVT is a commercial television broadcaster, they get their fundings from running
commercial breaks regularly throughout all of their shows and programmes. Differently from
the BBC, they actually have to fund their channel by themselves and dont have the public to
pay for them. Since ITV is known for a lot of famous shows such as XFactor, Britains Got
Talent and Im a celebrity, they seem to get a lot of money from just running certain advert
whilst these big shows are being aired. This is because companies know that thousands of
people will be watching them, and therefor there will be a lot more people seeing their product
showing on their television. Since these are prime times to show adverts, it costs a lot more
and therefor, ITV is making more money. Just because of ITV cutting to advert breaks every
15 minutes, it makes a lot of money for them to fund the channel and all of the programmes
within it.
In my opinion, ITV demonstrates more of a horizontal integration because the sort of things that
are shown on this channel, are similar to things that we see on other channels. Horizontal
integration is when there are more than one company at the same stage of production, whether
that is in the same or in a different industry, but when the products from the different
companies are similar, it creates competition. This means that ITV are constantly in a
competition with other broadcasters and they always have to compare their content with the
other broadcasters to make sure that people would prefer to watch their shows instead. ITVs
main competitor is BBC because ITV and BBC are the two biggest UK broadcasters, so it is
always a competition for which is the best channel. However, BBC have a lot more channels,
whereas ITV only has two (ITV and ITV+1). BBC have it a lot easier and are more likely to
come out as the best broadcaster since it has more channels than ITV does, however, ITV has
more of an entertainment factor which a lot of people prefer to watch.
ITV doesnt really have much of an influence on its audience since the majority of its content is
for entertainment only, however ITV includes sports and news so it could influence people to
start getting active and it could be quite a good influence because of its educational values.
However, everything in the media can potentially have a great influence on the audience
because the media have the power to make or break certain subjects and can have a
considerable influence over the publics opinion. I think ITV can also have an influence on the
industry because of the fact that it demonstrates horizontal integration and therefor other
broadcasters are constantly competing against them. However in 1955, a coalition of Tory
MPs, advertisers, and industry won the case for ITV to be a commercial channel, against the
BBC. They claimed that it would cheapen culture. This had a great influence on other

broadcasters to become a commercial channel and it also set an example that it is possible to
be a successful channel without having to be a Public Service Broadcaster. It also influenced
other channels because it is better for the public since they wont have to pay to fund the
channel and also it proves that it is possible to be more successful than the BBC. This also
had a great influence on the public because more people could now afford to by television set
and more people started to watch their broadcastings.

An Independent Production Company Hat Trick Productions

Hat Trick Productions is a British based independent production company that produces
television programmes that mainly specialise in comedy. Hat Trick Productions was founded in
1986 by Rory McGrath, Jimmy Mulville and Denise O'Donohue. It is known for producing
shows such as; Room 101 and Outnumbered.
Since this company is independent then the basically own themselves. The company was
founded by Jimmy Mulville, Denise ODonoghue and Rory McGrath, however, Denise
ODonoghue and Rory McGrath have left the company leaving Jimmy Mulville the owner of the
company.
The way that this production company makes their money and actually makes funds to keep
the company running, is a lot different from the way that TV broadcasters gets their funding.
Since it is a production company and they dont actually own a broadcaster or a television
channel, they have to make their money by putting their programmes on other peoples
channels. Hat Trick Productions are known for making programmes with a comedy nature
which makes it more appealing to broadcasters which makes it easier for them to air their work.
Hat Trick Productions work with BBC, ITV and Channel 4 a lot and occasionally they will work
with sky to air their shows. The way that they get fundings for their company is through the
broadcaster because essentially, by broadcasting their show, it is attracting more views and
therefore there is more money going into the television broadcaster. Since they are making
money for other peoples work, it is only fair to pay them for their hard work. Usually, a popular
programme will make quite a lot of money and a fair share of that money will be going back to
the production company since it was their work in the first place. To start with, the company
probably wasnt making much money at all and they probably found it quite hard to find a
broadcaster to show their work, but over the years, they have worked their way up and now
they are a very famous production company. Now that they are very well known for their work,
a lot of broadcasters would love to use their.
I think that this company mainly demonstrates a horizontal integration because the whole
purpose for their work is to find a broadcaster to air it afterwards. However, there are many
other production companies that are working on similar projects and they are at the same stage
of work as Hat Trick, which makes a lot of competition for who is going to get their work aired.
Although there is a lot of competition between broadcasters, the rivalries between production
companies are a lot more intense because if they dont sell their work to a television
broadcaster then they arent going to make any money at all which could be a big problem from
the company as they might start to struggle running their company.
The content that they produce could essentially have an influence on their audience but I think
that Hat Trick has more of an influence on the industry. I think this because other production
companies can be influenced to become as successful as they are and could be inspired by
how they have worked their way from the bottom to the very top. Also, because of the fact that
they are always in competition with other production companies, it would have an influence on
the television broadcasters because they would need to choose which work they preferred. It

would also have an influence on other production companies because they would always need
to know how to be better than Hat Trick Productions in order for them to air their work.

A Global Media Empire that includes Film Production The Walt

Disney Company
The Walt Disney Company, otherwise known as Disney is the second largest broadcasting
and cable company in the world. It is classed as a global media empire because it is a
multinational mass media corporation. Although it is a global empire, it was originated in
America and is American diversified.
The company was founded by Walt Disney and Roy O. Disney in 1923. These were the
original owners of the company, however it is now owned by Robert A. Iger who is a Chairmen
and Chief Executive Officer (CEO) of The Walt Disney Company.
The Walt Disney company is best known for their products of its film studio, the Walt Disney
Studios, which is today one of the largest and best-known studios in American cinema.
Although their film productions is what brings them the most income, they also have other
sources that gives them their fundings so that they can run their company. The Walt Disney
also owns and operates the American television broadcaster ABC. The also own some cable
television networks such as the Disney Channel, ESPN, A+E Networks and ABC Family. From
owning all of these television broadcasters, they will get a lot of funding from the commercial
breaks that they run. They also have published books, they sell merchandise, music and they
put on theatre performances. All of these also help to bring income into the company. One big
step forward for this company was by opening theme parks all around the word. They now
own 14 theme parks around the world and it brings millions of dollars to the company every
year.
Other than all of these things that bring a lot of money to the company in order for them to fund
their company, the biggest thing that they do to fund their company is by making films. They a
specially known for their amazing films and by having such a good reputation, lots of people
always want to buy their films on DVD and when their new films come out in cinemas, people
are also queuing to see them. This is what makes them the most money since their films are
always extremely popular, meaning that lots of people always want to buy them. The money
then goes back to the company and helps them fund for themselves.
In my opinion, The Walt Disney Company is an example of both vertical and horizontal
integration. The reason why I think this is because it demonstrates aspects of both.
It demonstrates vertical integration because Walt Disney is such a big company and it has a lot
of different activities going on within it. There are a lot of different aspects of the company that
all have different work being done for them. They also own a lot of other companies like
DreamWorks and a lot of TV broadcasters which is called backward integration. Since it is a
large company that has bought out smaller companies, it is classed as a vertical integrated
organisation.
However, it can also be an example of horizontal integration because within all of the aspects
of the Walt Disney Productions, there will always be competition between other companies,
even if the companies arent as big or as well-known as Disney, it still creates competition for
them usually it would be within their movies or it could even be within their television channels.

The majority of things that Walt Disney produces it usually rated PG which makes it suitable for
family watch and usually Disney will drop in subtle education hints that will teach children what
things are right and wrong. This creates a good influence for the audience.
It also influences the industry as well as the audience because they are always in competition
with other companies which influences the other companies to do better and to try and produce
their films at a better standard so that they actually have a chance at competing with Disney.

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() Vertical integration, Available at: http://www.businessdictionary.com/definition/verticalintegration.html (Accessed: 14 December 2014).
() Horizonta Intergration, Available at: http://www.businessdictionary.com/definition/horizontalintegration.html (Accessed: 14 december 2014).
() Ownership and control of the media, Available at: http://revisionworld.com/a2-level-levelrevision/sociology/mass-media-0/ownership-and-control-media (Accessed: 15 December 2014).
(1 December 2014) ITV, Available at: http://en.wikipedia.org/wiki/ITV_%28TV_network%29
(Accessed: 15 December 2014).
(28 November 2014) Hat Trick Productions, Available at:
http://en.wikipedia.org/wiki/Hat_Trick_Productions (Accessed: 15 December 2014).
() Hat Trick Company History, Available at: https://www.hattrick.co.uk/about-us/ (Accessed: 15
December 2014).
() How do public broadcasters obtain programming?, Available at:
http://www.cpb.org/aboutpb/faq/programming.html (Accessed: 15 December 2014).
() The Walt Disney Company - Robert A. Iger, Available at:
http://thewaltdisneycompany.com/about-disney/leadership/ceo/robert-iger (Accessed: 15
December 2014).
(15 December 2014) The Walt Disney Company, Available at:
http://en.wikipedia.org/wiki/The_Walt_Disney_Company (Accessed: 15 December 2014).