Spring Break
Career Talk
Can MBAs Make It in Entertainment?
Gabrielle Dudnyk, Vault.com
Issue date: 10/22/01 Section: Features
There is plenty of opportunity for MBAs in the entertainment industry, and this opportunity is growing every day. Sure, you could always put your MBA to work in the entertainment industry in the finance department. But now it is becoming easier for us to find the jobs we want in other departments where creativity is a job requirement. In the finance department, creativity is usually not a good thing. Discounting cash flows and determining return on invested capital is serious business: Being "creative" here could land you in hot water. In other functional areas like business development, strategic planning and marketing, companies are now more willing to pay a premium for applicants with an advanced degree, and in some cases, proactively seek them out.
There are several reasons for this. First, the industry is consolidating tremendously. In the cable industry, for example, there used to be thousands of small, regional cable operators that could best be described as "mom-and-pop" businesses. Now, much of the country’s cable systems are owned by MSOs (multi-system operators) like Time Warner, Adelphia Cable, Cox Communications, and AT&T. These companies, by virtue of their size, operate differently than small businesses and can change the nature of the industry. There can be more bureaucracy, more legal consideration, and more money to spend on promotional activities and acquisitions. Instead of just operating regionally, many MSOs are thinking nationally and are swapping systems and reconfiguring their operations. These activities tend to demand a more rigorous business analysis than day-to-day operational activities do.
Secondly, media and entertainment conglomerates are consolidating in order to vertically integrate, and therefore, gain control of more areas of their business. Viacom’s acquisition of CBS is a perfect example of this. CBS’s ownership of television stations and the Infinity radio property complements Viacom’s content production businesses such as VH1, MTV, Nickelodeon and Showtime. AT&T acquired MediaOne’s cable and content business because it wanted access to the cable infrastructure that covered the coveted "last mile" to the consumer’s homes. So while content production is still a differentiating factor of many entertainment companies, it is now more often just a part of the whole rather than the whole itself.
There are several reasons for this. First, the industry is consolidating tremendously. In the cable industry, for example, there used to be thousands of small, regional cable operators that could best be described as "mom-and-pop" businesses. Now, much of the country’s cable systems are owned by MSOs (multi-system operators) like Time Warner, Adelphia Cable, Cox Communications, and AT&T. These companies, by virtue of their size, operate differently than small businesses and can change the nature of the industry. There can be more bureaucracy, more legal consideration, and more money to spend on promotional activities and acquisitions. Instead of just operating regionally, many MSOs are thinking nationally and are swapping systems and reconfiguring their operations. These activities tend to demand a more rigorous business analysis than day-to-day operational activities do.
Secondly, media and entertainment conglomerates are consolidating in order to vertically integrate, and therefore, gain control of more areas of their business. Viacom’s acquisition of CBS is a perfect example of this. CBS’s ownership of television stations and the Infinity radio property complements Viacom’s content production businesses such as VH1, MTV, Nickelodeon and Showtime. AT&T acquired MediaOne’s cable and content business because it wanted access to the cable infrastructure that covered the coveted "last mile" to the consumer’s homes. So while content production is still a differentiating factor of many entertainment companies, it is now more often just a part of the whole rather than the whole itself.
