Shaping the corporate perimeter in a changing media industry.

Abstract

A constant theme in strategic media management literature is the transformational impact that digital media technologies and deregulation have had on shaping media firms’ corporate strategies. Whilst the role of corporate strategy is to encapsulate a firm’s long-term direction and scope of activities, it will also give a strong indication of how the firm will compete and be positioned in an industry. However, the transformative effects of a highly technological media environment have changed our traditional view of how the media industry is defined, and so developing a strategic recipe for competing in an ill-defined industry becomes more challenging. This paper considers the changing nature and definition of ‘the media industry’ and examines how this has influenced a media firm’s corporate strategy and perimeter. By examining the scope of firm activities through their acquisition and divestment decisions, we will be better able to understand the firm’s corporate perimeter and by implication the industry or industries where they compete. It concludes that whilst there are numerous perspectives on how to define the media industry, Porter’s (1980) seminal work on industry structure, profitability and attractiveness is just as relevant today as when it was first published.