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How important are film franchises to film studios?

Film studios use franchise to create synergy through horizontal integration. Horizontal integration is when a film producing company opens and purchases many different businesses in order to promote their films, for example they own TV channels, newspapers and game websites, furthermore they create merchandise products from the film and produce DVDs and Blu-Ray discs in order to gain more money from their film production.

An example of a horizontally integrated company is NBC Universal who own many cable channels, broadcast stations, websites, film studios, parks & resorts and international television studios. An example of cable channels that NBC Universal own is CNBC, this is the biggest news channel for business news worldwide and broadcasts to Asia Pacific, Europe, Middle East and Africa. This channel also has a CNBC HD+ channel which brings in more viewers as audience’s can watch it in a more technologically advanced way.