Dominion Media Case Study

Forward:

How can diversified media companies exploit opportunities in new media, given the phenomenal growth of the Internet? This question is much on the mind of the chairman and chief executive officer of Dominion Media, a diversified media company operating in the mid-South. He has asked his key managers to join in a retreat to ponder opportunities and strategies to participate in the explosive growth of the Internet and has sent a memo to his chief financial officer, asking for an outline of some options at the retreat.

(Prof. Cooper's interpretation: The top gun of a big company in media wants top brass and managers to brainstorm some good ideas for making money for Dominion Media via the new technologies).

The Company:

Dominion Media (not a real company) operates a diversified group of broadcast, cable operations and newspapers in the mid-South (in the mainland) but is best known for its recent success in establishing cable networks. Starting in the newspaper business, the company diversified into broadcasting with the coming of radio and TV in some of its markets, then established cable systems and cable networks. The company operates a broadcast group of radio and TV stations in the South. It has newspapers in four key Southern cities.

It has 400,000 cable subscribers in Georgia and South Carolina. Nationally Dominion is best known for its Climate Channel, which reaches over 80% of cable homes (like the Weather Channel). The company is also known for its Family Values Channel which reaches an even larger audience with a wholesome menu of reruns, mostly Westerns, sitcoms and family movies (like the Family Channel). A third channel, the Voyager Channel, dedicated to travel and travel advertising (like the Travel Channel) has been struggling.

Dominion's Inroads with New Technologies:

Most of the managers in the Dominion company have established Internet services and homepages for their customers. The newspapers have been most enthusiastic, primarily for defensive reasons, since phone companies and cable companies can use the Net to compete for classified ad revenues (i.e. to steal away customers). The cable networks have also created home pages to promote home viewing, and possibly some interactive ad capabilities.

Some Dominion TV stations have home pages for public relations purposes but haven't been able to make money from these. Radio and TV station owners are considering joint ventures with on-line companies, just as NBC and Microsoft have formed MSNBC. The cable TV manager, who is excited about new technologies is considering an option called cable modem in which customers could lease a "cable modem"...that is, they could hook up to TV and the Internet simultaneously and use joint services (combined moving picture/broadcast/and internet games/programs/services/ads, etc.).

The Case:

STUDENTS should consider what types of technologies might help Dominion but should also consider if there are any ETHICAL problems that might creep in if you do. (For example, if you create classified ads on line, how would you know if someone selling guns was a front for mercenaries or Skinheads...or does that matter? If you set up ways to show your TV shows on the internet with cable modems, might children have more access to obscene material? Are there hidden radiation effects, etc., from too much terminal fixation? Who knows?) Clearly some of what you consider is pure speculation and guesswork but every idea will be important and some may lead to other breakthroughs.