Understanding Media -
Professional Practice In The Media Industry
As one of the fastest growing sectors in the media today, console gaming has come a long way since the days of the very first home console; the Atari 2600. Console gaming is big business, with profit margins higher than some of the biggest Hollywood film studios. Because of this, the production size of each game and quantity of employees within each company has grown accordingly. As with other sections of the media industry such as print, television and film, console gaming has a structured system in use in regard to owners, employees and finance. If we are to fully understand the console gaming industry we need to examine the four key areas within it; publishing, development, distribution and the manufacturers of the hardware on which the games are used (Microsoft, Nintendo and Sony). In some cases these four areas work exclusively as separate entities to create a product, or, as with some major Hollywood studios, are vertically integrated in their production processes. As with the “Big Five” studios of the golden era of Hollywood cinema, we have a similar situation in the console gaming industry with the four main console manufacturers. These four companies all own and have complete control of various development houses, publishers and distributors. In the case of these “in house” productions the sources of finance vary but are mainly internal. When internal finance is not possible, there are other various means for the companies involved to acquire the money needed to complete the production process. The most common way for a company to get financial assistance is the use of sponsors. For example; a racing game could use billboards featuring the sponsors logos placed alongside each race track.
I have already mentioned the methods used by vertically integrated companies to create and distribute games, but there are many occasions when a separate company is used for each stage.
Publishers are the most powerful, and, perhaps the most important of the four main areas in console gaming. They are responsible for commissioning, funding and publishing, and usually have a great deal of control over the end product. Once the development process is completed, a publisher would also be responsible for the marketing, PR and manufacturing the finished product. They will decide on the type of product they want to deliver to the market, set targets that need to be met by the developers in order for the initial finance to become available and publish the end product, hopefully making a profit on the sales of said product.
Vertical integration in studio system The term "vertical integration" refers to the structure of a marketplace, which is integrated (rather than segregated) at a variety of crucial levels. In the case of the motion picture industry, the studio system established a market in which the studios owned production facilities, distribution outlets, and theaters. In other words, the studios controlled every level of the marketplace from the top down, from production to exhibition. "Vertical integration" began in the 1910s and inspired the postwar consolidation of the studio system as national distribution companies, such as Paramount merged with production companies, such as Famous Players and Lasky and subsequently began purchasing theater chains. All of the major studios in Hollywood (Paramount, MGM, Warner Bros., etc) owned theater chains; the minors, Universal, Columbia, and United artists, did not.
Video games started as arcade machines with simple graphics and even simpler stories, soon evolving into home gaming with The Magnavox Odyssey, the world’s first home-gaming console. It invaded living rooms in 1972, selling 300,000 units. Since then there has been many consoles and games released, some have been huge commercial successes which
Vertical integration is when an organisation own companies on two or more levels of the buying chain. Examples of this can be found within “The Big 4,” all of them own an airline, travel agent and a tour operator. The companies have until recently used different names for their travel agency, airlines and tour operators, but now they are power branding their companies so that customers can see whom they are booking with. An example of this is TUI UK, which has rebranded its companies using the Thomson name.
At this time, video games have made their way into the homes and hearts of many people since their meager beginnings as television novelties and arcade hits. But what goes into the process of creating a video game? Games, especially board games, don’t just happen. Their digital counterparts are not part of the exception either. There are painstaking processes and stages involved in creating and developing a game so that it is ready to be marketed to the public and so it also appeals to a certain fanbase or so it appeals to the masses. There is also the level of immersion and engagement that has to take priority within a game so that the player feels invested enough within the game to continue playing it after a certain period of time. The stages that take place within the creation cycle of a game can vary, but they usually follow three main phases. These phases are the Pre-production, production, then testing phases.
The four companies shown above have very different business models. Inditex owned much of the production and most of its stores. Inditex is thus a vertically integrated company. This made Inditex gain a competitive advantage, which is quick response to the market requirements. On the other hand, The Gap and H&M have a different business model. They owned most of the stores, but outsourced all the production. Benetton had a third business model. It invested heavily in the production, but licensees ran its stores.
center with the pool tables and a line of arcades in front of me. At least nine to twelve players are gathered around 2 gaming arcade machines in front of me. The two main popular ones that are of interest would be the Street Fighter 3rd Strike and the Marvel vs Capcom 2 machines. The gamers are heavily immerse in watching the players and cheering them on. I am observing four players playing on two separate machines. The two players who are on MVC2 are wearing both hooded jackets and baggy jeans with tennis shoes. It seems they were here for quite a while. Backpacks are off to the side of the machines or lying around randomly near them on the ground and some half eaten snacks can be seen on the tables nearby. A quick glance around allowed me to take in the surroundings. There are three pool table games in session occupied by two to four players per table. Three girls are having a drink to the table directly adjacent from my stool across the room. My location is near enough from the arcade machines to allow me to easily view the players and note all of what is going on and far enough to remain hidden and unsuspected of recording the scene. I am recording with my Nokia N95 with Carl Zeiss optics 5 mega pixel lens with creative sounds voice amp. I am wearing a zip up hooded jacket and some baggy cargo pants with a pair of vans allowing me to easily blend in as a normal spectator. Soon after, there are at least six to seven guys spectators for the four players. And also noted at ten minute intervals, the losers rotates out with one of the players lining up to be the new challenger of the victorious. The guys seem to be much louder and animate on the MVC2 ...
Have you ever wondered how much money these guys make? Well let’s take Call of Duty Modern Warfare 2. It took about 200 million dollars to produce and they sold 500 million dollars’ worth of copies. Take 500 million and subtract 200 million, 500 subtracted by 200 and that equals 300, and you get a profit of 300 million dollars! They made a lot of money and because of that they created a lot of other games.
Video games can be seen in both a positive and negative light. Video gaming has become a popular activity for people of all ages, yet many fear the aftermath they can ensue. Many children and adolescents expend large amounts of time playing them. Video gaming is a multibillion-dollar industry – bringing in more money than movies and DVDs. In fact, the PlayStation 2 was the first video game system to integrate DVD mechanics. It was originally intended to exist as a CD add-on to complement the Super Nintendo, but due to licensing difficulties Sony chose to develop the PlayStation as its own distinctive system. Video games have become very sophisticated. Some games connect to the internet, which can allow children and adolescents to play online with unknown adults and peers. The
Gamers are gamers regardless of where they live. There are many gamers around the world, and one of the largest gaming populations is located in Japan. (Niizumi) Japan has been, and continues to be one of the largest developers and creators of both of video gaming consoles and video games around the world. (Niizumi) Japanese video games are beneficial to society and are an excellent source of employment to many in Japan.
Whether they be first-person shooters like Call of Duty, sports games like Madden or Fifa, racing games like Forza or Mariokart, or even games and apps on your phones, there are quite a bit of gamers in here. According to the Entertainment Software Association, about 59% of American play some sort of video game, so gaming isn’t all that uncommon (Entertainment Software Association, 2014). As such, there must be some sort of effect on the audience of this growing form of entertainment.
Vertical integration is where a company becomes their own supplier or distributor through acquisition. Seprod uses the strategy by their acquisition of Belvedere Estate in 2006 so as to expand its dairy farm pastures to increase their supply of milk output from the dairy farming. They also use vertical integration in their subsidiary Industrial Sales Limited. This is done by making them the main distributer and marketer of their
As technology advances, new and creative forms of entertainment immerge from these advancements. One form that has grown immensely in popularity over the past dozen years has been video games. Taking form nearly four decades ago, video games have been one of the major embodiments of the growth of entertainment technology. Today, video games have taken many shapes, from the general PC and console games to special applications that can be found on social networks and even millions of cell phones around the world.
Lynch (2012) asserts that it is necessary for an organization to carry out an analysis of its resources and capabilities as it help it in identifying the places where value can be added by the organization. This also helps the company in finding out ways to gain competitive advantage in the market. The given case on Nintendo showed that by 2005, Nintendo appeared to be heading towards an end as its rivals Microsoft and Sony has captured the market through Xbox 360 and PlayStation 3 respectively. In this scenario, Nintendo innovated Wii which changed the market scenario in 2007. The case showed that innovative new strategy by Nintendo with its Wii games machine has transformed the industry and revived the profitability of the company. Since the release of the Wii, Nintendo is the leader in the video game industry. By introducing a totally new, one of a kind console, Nintendo has set clearly its goal and objectives, i.e. to reach an unexplored market share by introducing new gaming experiences, and therefore being the leader over its two main competitors, Sony and Microsoft. The case thus highlights the need to take a resource based view of the capabilities of the company so that such resources can be exploited to generate higher value for the firm.
First, companies identify interrelationships among already existing business units in order to seek for any opportunities to transfer skills or share activities. Second, companies select the core businesses that will be the foundation of the corporate strategy by determining the attractive industry and sustainable competitive advantages. Third, companies create horizontal organizational mechanisms to facilitate interrelationships among the core business units by strong corporate identity, mission statement emphasizes integration, and incentives for business-wide success. Fourth, companies pursue diversification opportunities that allow shared activities. Fifth, companies pursue diversification through the transfer of skills if opportunities for sharing activities are limited or exhausted. In other word, it is the stepping stone for sharing activities in the future. Sixth, companies pursue a strategy of restructuring if this fits the skills of management or no good opportunities exist for forging corporate interrelationships. At last, companies pay dividends so the shareholders can be the portfolio
Many people believe that video games change people and mislead them to do bad things, such as drugs and alcohol, but it is the opposite. Gaming prevents people from such acts and actually helps to keep them away from the substances. Lots of people, mainly parents, believe that video games harm people so they try to keep their children away from them. In reality, video games make your life better. Video games can provide many benefits to your lifestyle as “numerous academic studies indicate that playing video games has many psychological and even physical benefits” (Guarini). Gaming helps stimulate the brain and advances your problem solving abilities. There are disadvantages to gaming, which is true, but the amount of benefits outweigh them by far.