Thursday, September 4, 2014

Binary Models and "The Great White Sharks" of Business

Binary Models and Monopolies
Today in Journalism class, we talked about the different binary models. There are 4 different kinds of binary models:
  • Hot (Requiring lots of focus) and cold (Requires less focus, so you can probably do something in the background)
  • Elitist ( Focuses on internalization of a concept and mostly gets money through donations or government grants) and populist (Focused on being popular and usually use advertising and direct sales)
  • Content creators (Make content) and Content distributors (Distribute content)
  • Then there's Information and Entertainers. (These are not displayed, but this binary model is just the difference between companies like National Geographic and Disney)
Here's a picture I made in MS paint to make things easier:
A
Many content distributors are starting to make their own content and vice versa. For example: Netflix, a content provider, has started to make shows like Orange is the New Black or House of Cards. This means that Netflix won't have to go through the process that a regular content provider will have to take. That allows them to put it on their website so that anyone can watch it without as much of a hassle. (Or costing as much money) This is a kind of vertical monopoly. Another kind of monopoly is a horizontal which makes it so that everyone has to come to a certain company to get one step of a process done.

The Great White Sharks
Mr. Miller used an analogy saying that many of the big companies (like Google or Disney) are like great white sharks. Google, a great white shark, might buy a company just starting out because they feel like it's threatening their business. However, Google would never buy Disney, or, how Mr. Miller explained it, eat their own kind. A process like this causes conglomeration, when companies come together in a one huge clump by absorbing the little things that pop up.

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