I’ve avoided linking to a lot of recent coverage on whether or not media “convergence” is a success or failure, primarily because they attempt (and don’t succeed) to interpret the world through the failures of Vivendi and AOL-Time. However, the Economist, runs a story that is a great overview of what works and doesn’t with amassing mass media.
In short, scale is good when it comes to distribution, clout and cross-promotion (to a point). Being large is bad when it comes to creativity.
Hollywood studios have tried to manage (the creative challenge) by allowing autonomous boutiques to flourish within their conglomerate structure, designed to nurture a more creative, less formulaic, spirit. It is a pattern that has characterised creative industries throughout their short history as mass-entertainment media. The record industry has for years been built on this model: small independent labels (such as Island Records), which are better at spotting new artists, are bought by the big guys (in its case Polygram, now part of Universal), which then begin the search for small independents again. It can work in TV too: HBO is given freedom within AOL Time Warner, for instance, to create challenging new drama, such as ?The Sopranos? and ?Six Feet Under?.