Disney-Fox Merger Can Make Business Harder for Netflix

Walt Disney Co. and 21st Century Fox has been in talks to sell most of the latter’s company to the former, stated a report citing sources familiar with the matter which came out on Monday.

The discussions, while still not guaranteed to be finalized, point to a changing landscape in the media world.

Netflix has been able to make itself a massive force in the entertainment industry with its estimated total of 109.3 million subscribers internationally, which has settled itself comfortably into the legacy television and cable businesses.

Despite this, analysts pointed out that Netflix might face some struggles as giant media corporates merge their portfolios and publish their own high-demand offerings, making Netflix exert a bigger effort in order to compete and stay as one of the top entertainment provider today.

“If Disney or Comcast or anyone else comes up with something with a similar subscriber profile it will make it that much harder,” an analyst said.

Netflix already made an announcement, stating that it has plans of spending up to $8 billion on its content for 2018.

The company’s catalog contains “a few buzzy shows, a handful of potential breakout hits and a whole lot of clutter,” analysts point out.

Scripps Network Interactive was obtained by Discovery Communications in July for almost $12 billion. Comcast acquired Dreamworks last year, and Verizon is now the owner of AOL and Yahoo. While AT&T and Time Warner agreed to join forces, though the deal could be canceled due to the Department of Justice, over anti-trust concerns.

CBS and Viacom's supposed merger was renounced by Shari Redstone, the vice chair of the board for both companies, back in December.

Disney-Fox Merger Talks

Talks regarding selling most of 21st Century Fox to Disney has been on-going for the past few weeks, though it has been determined that the deal is still far from being certain.

According to sources, both sides are not talking right now, but considering the on-again off-again nature of the deal, it’s possible that the talks could be revisited.

The sources added that Disney will not be buying the whole company and will leave Fox with the opportunity to firmly focus instead on its news and sports departments.

Disney could not own two broadcast companies, leaving it with no choice but to leave out the Fox broadcast network. Fox’s sports programming assets are also out of the picture due to belief that combining it with ESPN will be seen as anti-competitive in an antitrust point of view.

Officials at Disney and Fox refused to give any immediate comments.

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