For roughly the last two weeks– hell, even longer it’s been basic “acceptance” that Disney would be acquiring a large portion of 21st Century Fox‘s assets. Brent Lang of Variety reported earlier this week to expect a deal to be announced Thursday, and I don’t think it’s wrong to just accept that it would be happening. And as we’ve found out today, Brookes Barnes of the New York Times confirmed it appears to be happening,
The Walt Disney Company said on Thursday that it had reached a deal to buy most of the assets of 21st Century Fox, the conglomerate controlled by Rupert Murdoch, in an all-stock transaction valued at roughly $52.4 billion.
I must say, this is terrifying to me. Disney is already a mega-giant in the entertainment industry as the company’s studio brought in $2.52B just in the first-quarter of this year (2017). Now, now, now, hold on– I’m not against a company making money. In no way, but to see a company gaining more and more ground in one specific area starts to create a monster who dictates the product.
One reaction I saw on twitter from Michael Pasquale sums up what Disney appears to be turning into,
— 800 Pound Productions (@800lbProds) December 14, 2017
Now, this acquisition is huge, as it’s being reported to be for $52.4B, and I’m left sitting here looking back to precedent… the AT&T and Time Warner merger, which the Department of Justice blocked.
Something that’s being thrown around when sites aren’t straight out saying this is a “done deal,” which it’s not, is that this acquisition would make Disney a formidable competitor in the land of “online streaming.” Barnes mentioned this in the article confirming the deal, saying,
Disney now has enough muscle to become a true competitor to Netflix, Apple, Amazon, Google and Facebook in the fast-growing realm of online video.
But see, I don’t buy this “spin zone,” because Disney was already on its way to the land of online streaming as they announced back in August of this year (2017) of their direct-to-consumer digital streaming service. With the powerhouse that they are, I can’t say to you honestly that they wouldn’t be in immediate competition with the other DTCs. One of the reasons I base this off of is that Disney will be pulling its movies from Netflix come the end of 2018.
So, it’s clear that Disney has been gearing up to compete in this “market” that is “online streaming,” and renders any talk of them becoming competitors to the preexisting DTCs as being a rationalization to, what I see as an inevitable, Trump Administration DOJ block.
The DOJ will look at the wider scope, which is that this in all essence would form an entertainment monger, and has extensive “reshaping implications” on the landscape that almost weaponizes the industry in their favor. Proof of this being, Erich Schwartzel of The Wall Street Journal reported Disney has exerted its “weight” on theaters by mandating a 65% of ticket revenue STAR WARS: THE LAST JEDI makes will return to Disney.
This is quite the spike since the standard is usually around 45-50%, and this forces theaters’ (especially small owned ones) backs against the wall as they can’t risk not showing TLJ with the astronomical amount of profit they’d lose out on.
Whether (you see) the AT&T/Time Warner block was bias or not, I can’t see a single reason why this acquisition wouldn’t be blocked. I will honestly be surprised if this goes through without a hitch, and at that point, I can understand the claims of bias even though I don’t believe there was (in reference to the AT&T/Time Warner block).