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Diversification Strategy of Global Media Conglomerates: A Comment


  • Michael Stephan


Chan-Olmsted and Chang's (2003) framework for the analysis of product-diversification strategies of media conglomerates is critiqued from a dynamic resource-based perspective. In the spirit of spurring intellectual debate, this article proposes a revised framework that incorporates newer findings about the benefits of related product-diversification strategies from the strategic management literature. A differentiated view of the "media content" notion is presented that distinguishes between assets, skills, and capabilities and competencies. From this differentiated perspective, I argue that there are 2 types of scope effects: traditional economies of scope that grant the media firm a short-term competitive advantage over rivals and dynamic scope effects that contribute to a sustainable competitive advantage.

Suggested Citation

  • Michael Stephan, 2005. "Diversification Strategy of Global Media Conglomerates: A Comment," Journal of Media Economics, Taylor & Francis Journals, vol. 18(2), pages 85-103.
  • Handle: RePEc:taf:jmedec:v:18:y:2005:i:2:p:85-103 DOI: 10.1207/s15327736me1802_1

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    References listed on IDEAS

    1. Jeffrey K. MacKie-Mason & Hal Varian, 1994. "Economic FAQs About the Internet," Journal of Economic Perspectives, American Economic Association, vol. 8(3), pages 75-96, Summer.
    2. Shenker, Scott & Clark, David & Estrin, Deborah & Herzog, Shai, 1996. "Pricing in computer networks: Reshaping the research agenda," Telecommunications Policy, Elsevier, vol. 20(3), pages 183-201, April.
    3. Bodnar & Peter Dilworth & Salvatore Iacono, Judith, 1988. "Cross-sectional analysis of residential telephone subscription in Canada," Information Economics and Policy, Elsevier, vol. 3(4), pages 355-378.
    4. MacKie-Mason, J.K. & Varian, H.L., 1993. "Some Economists of the Internet," Papers 93-16, Michigan - Center for Research on Economic & Social Theory.
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