Mega deal: disney buys major part of murdoch’s fox group
A mega-acquisition is turning the U.S. Media landscape upside down: entertainment giant walt disney wants to gain the upper hand in the battle for movie and TV viewers with the biggest acquisition in its history.
The group is swallowing large parts of its rival 21st century fox from the empire of media mogul rupert murdoch for around 52.4 billion dollars (44.5 billion euros). The groups confirmed corresponding reports.
Disney pays the purchase price in its own shares and takes over almost all of fox's film and TV business as well as its international activities. As a result, several television channels and the traditional film studio 20th century fox will change hands. The package also includes fox's stake in british pay-TV provider sky and a stake in streaming service hulu, which gives disney a controlling interest.
Fox to focus almost exclusively on news and sports in future. Murdoch's group will be massively streamlined by the sale; what remains of the business will be spun off into a new company. Fox will keep its major sports channels and the well-known news channels. Things are going well here at the moment – ratings and advertising revenues are high, not least because of the hype surrounding donald trump's presidency. Murdoch has close ties to trump, who is considered a big fox fan.
Disney, meanwhile, gains a lot of additional TV and movie content with the acquisition, setting the stage for a major assault on the booming streaming market. The group plans to launch an online video service in 2019 to compete with netflix. The sports channel ESPN, which is suffering from dwindling subscriber numbers, is to be launched as an internet service as early as next year.
Streaming is seen as the business of the future; more and more US customers – especially the younger target groups – are cancelling their cable contracts and watching TV on the internet. Disney already has access to a lot of attractive content through its film studios, which are behind blockbusters like "star wars". With the fox acquisition, the group secures a host of further exclusive productions.
Even though the fox group is known in particular for its arch-conservative political talk shows, it also provides contrasting programs in other areas. With the "simpsons," but also with shows like "empire," series like "fargo" and "the americans" on pay-TV channel FX, and box-office hits like "avatar," "X-men" and "deadpool," the murdoch group has been able to celebrate major successes and win over critics.
Since the acquisition includes international holdings such as sky and star india, disney is also strongly expanding its global business. Fox holds 39 percent of sky so far. The plan to buy the network outright is in limbo because of concerns raised by british regulators. The change of ownership could have a positive effect here, as the regulators are primarily interested in the murdoch clan, which had made itself unpopular in 2011 with an abhor scandal.
The deal with fox also doubles disney's stake in small netflix competitor hulu, in which both fox and disney have held about 30 percent so far. Disney boss bob iger, whose term of office is extended to the end of 2021, had already declared war on netflix a few months ago by announcing a licensing partnership.
In the meantime, the US cable giant comcast had also expressed interest in parts of 21st century fox, but then dropped out of the talks. Murdoch had built his company over decades into a media empire. The 86-year-old australian is controversial, with critics accusing him of using the conservative tv news channel fox news to influence U.S. Policy.
The company empire of the media mogul, which traditionally stands for aggressive acquisitions, continues to disintegrate with the sale. In the wake of the disobedience scandal at the british tabloid "news of the world," he had already separated his newspaper business, which includes the "wall street journal" and the "new york post," from the rest of the group under public pressure.
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