Ownership and funding blog post

Public service broadcasting (PSB) These are programmes that are broadcast for the public
rather than purely commercial purposes. These programmes can be things such as local
news coverage, arts programmes and religious
broadcasts. These programmes are usually funded
by the government who find their money from
annual fees charged on receivers.
In some countries public broadcasting is ran by a
single organisation but in the UK all of the BBC
channels are funded by the general public who pay
their TV licence, this figure is set by the
government. This TV licence funds all of BBCs television, radio and online coverage. This
means that all of their channels are broadcast for the public rather than commercial
purposes. To make sure this happens the BBC trust is in place to make sure the BBC deliver
their mission of producing the most creative and distinctive output; innovative online
content to make a more personal BBC and to serve for all audiences whilst providing value
for money.
Commercial broadcasting This is the opposite of public service broadcasting. Its where
the broadcasting of television and radio programmes is
owned by corporate media rather than state sponsorship.
Its primarily based on the practice of airing radio
advertisements and television advertisements for profit.
This is different to public service broadcasting as they
receive government subsidies and refrains from using paid
advertising. The biggest commercial channel in the UK is ITV.
Corporate and private ownership Private ownership is funded simply by advertising. This
means that programmes are decided by
company shareholders rather than the public
which is how the BBC works. Shareholders will
want to make the most amount of money
possible hence the reason why they select what
programmes are aired depending on how
lucrative it is.
BBC have a broad range of programmes on their channel as they are publically owned rather
than the likes of MTV or the Discovery channel who aim at much more of a niche market.

Global companies These are companies that operate on a global level rather than on a
national level such as ITV. A good example of this
would be Sony pictures who operate on a global
level with film production. They are based in
California, USA but are able to distribute
worldwide. Originally Sony was founded in Japan
but they now own companies all over the world
such as Left Bank pictures which is a UK
company.
Vertical integration This is where a media
institution owns several different companies at different stages of the production or the
supply chain. Warner Bros would be a good example
of this as they are a huge multi-national media
conglomerate who owns companies at each stage of
the supply chain maximising profits.
Harry Potter and the Deathly Hallows part 2 would
be a great example of how Warner Bros used vertical
integration to maximise potential earnings from the
production.
Production It was created by Warner Bros pictures in association with HeyDay films.
Distribution Distributed by Warner Bros Distribution.
Marketing It was marketed using several of Warners companies. HBO and CNN both ran
big promotional campaigns that helped the
sales of Harry Potter and the Deathly Hallows.
Exhibition It was exhibited by Warner Bros
international cinemas which was able to
reach a worldwide audience. Also, in the USA
HBO broadcast a television premiere of the
film which meant profits were maximised as
they had exclusive rights, this was all because
of vertical integration.
Horizontal integration This is where a production company expands into other areas of one
industry. The idea of owning many media outlets, which run almost the same content, is considered
to be very productive, since it requires only minor changes of format and information to use in
multiple media forms.

For example the content in broadcasting television would be used in broadcasting radio as well and
can then be produced as print media in newspapers as well. This means that content can move
fluidly between divisions of the same
company.
A good example of how horizontal
integration can lead to monopolisatiuon is
Rupert Murdochs empire. He now owns a
huge amount of the media that we see
today across all platforms. He owns
television stations, film production
companies, newspapers and much much
more. Some say that the monopolisation
of the media industry is not a good thing as
it can lead to the consumer being fed bias
news due to it being controlled by very few people.
FUNDING TYPES

The license fee This is an official record of payment for the reception of television
broadcasts. In the UK a television licence
is required for each household that
watch television irrespective of what
signal is used. However, a licence fee is
not needed if you own a television but
only use it to watch DVDs or catch up
services and dont watch live television.
The license fee is used to fund the BBCs
television services, radio services and
internet services. The license fee is used
to fund about 75% of the BBCs productions and the other 15 comes from the profits of BBC
worldwide which is a company owned by the BBC and sells programmes to foreign
countries.
Subscription This is where subscription fees fund the content creator to be able to create
content. A good example of a
subscription based TV service
would be Sky who charges
their customers a certain
amount of money per month
to be able to watch the
services that they provide. Sky
subscription services start

from 20 per month and from these fees it allows them to create and provide content for
their customers. Skys profits last year were up 9% to 1.33 billion.
One-off payment to own product A good example of this would be Apple TV as once you
have paid for its yours and you can use it to view content. It requires a one off payment of
80 and then you can receive digital data from a
number of sources. There are downfalls to this
though as you wont be able to access live TV as
there is no subscription fee meaning youre relying
on online access to view content.
Pay Per View - Pay per view is a type of pay
television where a subscriber of
a service can pay to view a
private telecast that is created by
the service provider. The
difference between pay per view
for television and film is that
when you pay for television everyone gets it at the same time whereas film can be viewed
at any time on services such as Sky Box Office. Pay per view is most popular with sporting
events and movies. The most lucrative pay per view of all time was recently in a boxing
match where Maywhether took on Paquiao and it made approximately $400,000,000 for
HBO. Pay per view does seem to be affecting some sports so less and less sporting matches
are pay per view. It is brilliant for movies though. Pay per view is also now prominent online
also due to the rise of the internet, this is a service that is also now available.
Sponsorship Sponsorship is when you gain funding from being supported by a certain
brand and/or company, this way the person
who is sponsoring can gain exposure by being
shown to support a popular brand and the
company being sponsored can gain exposure
from the company sponsoring if it is popular
also. Brands are keen to sponsor on
programmes to gain big exposure and can also
gain credibility as they are supporting well
known and loved brands. A great example of
how sponsorship helped both parties was the
brand Surf who sponsored TOWIE. This
helped surf as their sales went up by 1.2
million and TOWIE were helped with the
sponsorship that was provided.

Product Placement This is where a company pays a TV channel or programme maker to

include its products or brands in their programmes. This can be a great way to generate
revenue for the company and to fund production costs as all they have to do is subtly place
the product in sight of the viewer.
The first product placement on
UK television was a coffee maker
on the ITV show This Morning.
They paid ITV 100,000 for a 4
week placement of the product.
ITV said that Product Placement
could be worth 50 million a
year alone just from this method
evidence that this is a brilliant way to fund content creation.
Private Capital This is where one person
uses their own money to invest and fund
productions. Megan Ellison is a good example
of someone who has used private capital to
invest in productions and make them
happen. She is the daughter of billionaire,
Larry Ellison hence the reason for so much
money and she has invested this into things
such as American Hustle and Zero Dark Thirty
which have been Oscar nominated.
Her first production was Walking Madison which she invested $2 million into and it was
screened at many festivals. If the money is there, Private Capital is probably the best way of
funding a production as you dont have to worry about other methods that may take some
of the production value away.

Crowd Funding This is where you can raise money for a project by raising monetary
contributions from a large number of people, normally via the internet via websites such as
Crowdfunder or KickStarter.
Crowdfunding can create huge
amounts of money if the general
public genuinely believe in the idea
and they are usually encouraged to
donate with incentives such as their
name in the credits if they donate a
certain amount. Wish I Was Here is

a move they was funded solely by crowd funding and raised an incredible $3.1 million. Proof
that if the idea is good enough and the general public get behind it money can be raised and
ideas can happen.
Development Funds - An indirect sales channel where funds are made available by the
brand/manufacturer, to help companies, partners or distributors with their projects, it sells
the product and increases exposure around local areas for national companies.
A good example is MDIF who provide
affordable financing and technical
assistance to independent news and
information businesses. Over the past 19
years MDIF have invested $133.9 million into 108 different businesses in over 35 different
countries. They are a not-for-profit organisation.
Sources:
https://www.kickstarter.com/
http://www.mdif.org/
https://en.wikipedia.org
https://my.sky.com/orderboxoffice/
http://www.theguardian.com/media/rupert-murdoch
https://en.wikipedia.org/wiki/Vertical_integration
http://www.bbc.co.uk/