easing share of News Corp.s growth must come from broadcasting, movie production and satellite communications (Kirkland and Kinkead, 1984). The strategy of vertical integration.Vertical integration relates to the make-or-buy choice companies make. It involves a strategic decision to perform activities within the company as opposed to purchasing them from an independent organisation (Besanko et. al. 2000). Murdoch has pursued vertical integration with a vengeance in the newspaper industry (Gunther, 1998). He has tried to emulate this boundary expansion strategy in America, purchasing Twentieth Century-Fox followed by numerous TV stations to supply his programs to consumers, instead of purchasing from competitors. He was the first to realise that owning more TV stations is strategically important in his quest to make Fox the number one network. Vertical integration allows Hollywood production facilities to feed their distribution apparatus and create symmetry within the business.Vertical integration, as a component of a corporate growth strategy, is apparent throughout the Murdoch empire. News Corp. is gradually investing in all areas of the entertainment industry to compete for the hearts, minds, and eyeballs of the worlds 6 billion people (Rose, 1998, p2). By integrating vertically Murdoch is able to exert increasing control over the content of his numerous communication channels. One medium is used to boost others through content and advertising, in addition to ridiculing his rivals. Furthermore, strategic buys such as baseball clubs ensure that loyal fans purchase his cable channels in order to watch games, and are subsequently exposed to a foray of News Corp. offerings.Diversification. Sutton (1998) highlights that in order to understand the constraints and opportunities for diversification, a company must focus on the resources it can deploy. Firms can diversify by developing a new business area internally, by embarking on joint ve...
