chapter 4

Jihad Faroukhi
Dr.Ibahrine
Global Communication
Detailed Outline: The transnational Media Corporation and the Economics of Global Competition

· The transnational corporation TNC represents a natural evolution beyond the multinatioanl corporation of the 1960s and 1970s.One dintinctive feature of TNC is strategic decisions and allocation of resources based on economic goals and not national borders.
· The Transnational media corporation TNMC is the most powerful economic force for global media activity in the world. TNMC promotes the use of advanced media and information technology on a worldwide basis.
1. The Transnational Media Corpation
Two myths concerning the intentions of TNCMs and the people runing them
1. TNMCs operate in all markets of the world- FALSE, TNMCs tend to choose preferred markets, usually home mkt.
2. TNMCs have one singular business approach- FALSE, TNMCs have different strategies depending on their leadership
2. The Purpose of a Global Media Strategy
1. The majority of Trasnatioan Media Corporations become foreign direct investors gradually and do not set out to do so at the beginning of their companyB. TNMCs begin as a campany that is especcially strong in one or two areas.
3. The Globalization of Marketing
The globalization of markets involves the full integration of transnational business,nation-states, and technologies operating at high speed.
3.1. The Rules of Free Market Trade
· Free market capitalism
· Deregulation
· private sector
· opening of domestic market
· competition and choice
3.2. Foreign Direct Investment
3.2.1. Propriatary and Phisical Assets
3.2.2. Foreign Market Penetration
3.2.3. Production and Distribution Effecencies
3.2.4. Overcoming Regulatory Barriers to Entry
3.2.5. Empire Building
3.3. The Risks Associated with FDI
· Laws and rules of host country.
· Potential political instability.
· Socialist/nationalist govs.
· Anti-foreign business
· Need to do a country risk assessment before investing
4. Transational Media Ownership
4.1. Mergers, Acquisitions, and Strategic Alliances
4.1.1. Mergers: two companies combined into one example Time and Warner à Time Warner in 1989
4.1.2. Acquisitions : one company buys another to add/ acquire the other’s productive capacity Example Viacom buys CBS in 1999
4.1.3. Strategic Alliance : business relationship btwn. 2 or more companies to work towards a collective advantage Exmple Walt Disney licenses Tokyo Disneyland
4.2. When Mergers and Acquisions Fail
4.2.1. The Lack of Compelling Strategic Rationale
4.2.2. Failure to Perform Due Diligence
4.2.3. Post-Merger Planing and Integration failure
4.2.4. Financing and the Problem of Excessive Debt
5. The Media and global Finance
Media and telecommunication entails high start up costs and risk, size and reputation of TNC predict ability to raise capital in foreign mkt.
5.1. The Role of Global Capital Markets
5.2. Capital Markets Loans
5.3. Debt Financing
6. Business and Planing Strategies
6.1. Understanding Core Competency
6.2. Vertical Integration and Cross Media Ownership
6.3. Broadband Communication
7. Transational Medi and The Marketplace of Ideas
7.1. Transnational Media and economic Consolidation
7.2. The Deregulation Paradox
7.3. The Market Place of Ideas
7.4. Global Competition and the Difusion of Authority
7.5. TMNCs and Nation-States