Disney/FOX Acquisition Thread

[Nick]

Meanwhile, Fox started the popular R-rated CBM trend with Deadpool, a raunchy, hilarious, over-the-top violence Marvel movie and then did it again with Logan, a gritty, western-like setting from X-Men. Both movies are violent and have the tendency to say F-words and other things that wouldn't appear under the MCU. Even MCU TV shows, they don't go as far as saying the F-word and any of the thing like that, it seems good and basic and fits well with most of the cable drama shows. Some characters have some nude and butt scenes, but I don't think they go as far as what Deadpool does. Guarantee that X-Men would be incorporated into the MCU sooner or later, effectively terminating the Rated -R CMB movies, leaving Sony as the only hope to create an R-rated CMB for the Spider-Man universe.

Just because someone swears does not mean that a movie is "edgy". Hell, they dropped a decent amount of "shits" in Ragnorak, which is right around the same category as the F-word.

As i've said, if audiences prove that there's money to be made with R-rated CBMs, which both Deadpool and Logan have, then Disney will not pass up on a money making proposition.

 

[Paulio]

Just because someone swears does not mean that a movie is "edgy". Hell, they dropped a decent amount of "shits" in Ragnorak, which is right around the same category as the F-word.

As i've said, if audiences prove that there's money to be made with R-rated CBMs, which both Deadpool and Logan have, then Disney will not pass up on a money making proposition.

In Ragnorak, only a couple of S-words is used, plus a couple uses each of damn, hell, b*tch, ass, and "OMG". Nothing persuasive. A few other, milder words as well. Like previous MCU films, no F-words are used, some innuendo jokes but nothing too raunchy. MCU formula is still tame compared to Fox's Deadpool and Logan. I don't think Disney would continue the R-rated CBMs trend once they acquire the film rights to X-Men and once the pre-production of the X-Men movies is done. If it's Comcast/NBCUniversal instead, they would likely continue the trend as long as they feel like and not like Disney mandate what can or what can't be used or which character be moved into the MCU. There are millions of fans Disney needs to cater to and there's a lot of fans who want to see the X-Men and the F4 being integrated into the MCU. It may continue for a limited time, but don't be surprised when Disney decides to integrate them into the MCU and kill off the R-rated CMB trend.

 

[AlexanderMBush]

Disney, Fox Talk to Bankers as Deal Talks Progress – Variety

 

[zg44]

Disney, Fox Talk to Bankers as Deal Talks Progress – Variety

If Comcast does end up stepping aside and not placing a formal bid for the Fox assets, I'd think that Comcast takes a hard look at Sony's tv/movie studio later.

Sony's tv/movie studio is the only available integrated tv+movie studio other than Fox that'd be purchasable on the market if you need an $8bn a year content creator. Viacom is just a $3bn a year movie studio with a bunch of cable networks (since the tv production was mostly taken over by CBS when they split). The others like Lionsgate ($2bn a year in revenue) or MGM ($1bn a year in revenue) are too small to match Fox or Sony.

The question is really what Comcast's strategy is: We know Disney is going all in on content and streaming to compete with Netflix/Amazon Prime/etc.

Will Comcast go that same route? And if they do, would they want to try to pick up Sony Pictures for somewhere around $15 billion to be able to match Disney+Fox in terms of tv/movie production? If you add Sony's tv/movie production to NBCU, you create a content creator that can compete on scale with Disney+Fox and Netflix in the long run.

A huge benefit is that Sony Pictures only owns significant market share in tv/movie production in the US, so you wouldn't end up with significant anti-trust issues with a Comcast purchase of Sony.

Of course, a big concern for Comcast is cannibalization since streaming services cannibalize their paytv cable subscribers, but they may have to bite that bullet at some point and just make the switch to streaming.

 

[quinnmac000]

If Comcast does end up stepping aside and not placing a formal bid for the Fox assets, I'd think that Comcast takes a hard look at Sony's tv/movie studio later.

Sony's tv/movie studio is the only available integrated tv+movie studio other than Fox that'd be purchasable on the market if you need an $8bn a year content creator. Viacom is just a $3bn a year movie studio with a bunch of cable networks (since the tv production was mostly taken over by CBS when they split). The others like Lionsgate ($2bn a year in revenue) or MGM ($1bn a year in revenue) are too small to match Fox or Sony.

The question is really what Comcast's strategy is: We know Disney is going all in on content and streaming to compete with Netflix/Amazon Prime/etc.

Will Comcast go that same route? And if they do, would they want to try to pick up Sony Pictures for somewhere around $15 billion to be able to match Disney+Fox in terms of tv/movie production? If you add Sony's tv/movie production to NBCU, you create a content creator that can compete on scale with Disney+Fox and Netflix in the long run.

Of course, a big concern for Comcast is cannibalization since streaming services cannibalize their paytv cable subscribers, but they may have to bite that bullet at some point and just make the switch to streaming.

Comcast is an ISP, even with streaming they are making money because people require internet and still is easiest access is through cable/fiber.

I think Comcast/Universal Pictures are starting to learn the current studio set up isn't working well. The truth of the matter people who work for the head studio are being spread thin across multiple projects and its reflecting strongly with the products that are being released on the movie side.

Ironic once they broke out their television into multiple divisions, now they are starting to do extremely well with well received shows both critics and general public alike.

Personally, I think Comcast would be wisest if they invested more resources into content creators to acquire them such as Gkids, Laika, Sanrio, Cartoon Salon, Studio Ghibli, EuropaCorp, Scream Factory, A24, Studio Mir, Shonen Jump, Blumhouse, kids book publishing houses etc while keeping their operations independent. These are the studios pumping out original films/IPs that can be pushed out to other areas. They can acquire these for much cheaper and a higher ROI than another studio.

Having a large back library is great because you can exploit already established IPs but at the same time, there is no guarantee lightning will strike twice. Kinda like this current super hero phase.

 

[zg44]

Comcast is an ISP, even with streaming they are making money because people require internet and still is easiest access is through cable/fiber.

I think Comcast/Universal Pictures are starting to learn the current studio set up isn't working well. The truth of the matter people who work for the head studio are being spread thin across multiple projects and its reflecting strongly with the products that are being released on the movie side.

Ironic once they broke out their television into multiple divisions, now they are starting to do extremely well with well received shows both critics and general public alike.

Personally, I think Comcast would be wisest if they invested more resources into content creators to acquire them such as Gkids, Laika, Sanrio, Cartoon Salon, Studio Ghibli, EuropaCorp, Scream Factory, A24, Studio Mir, Shonen Jump, Blumhouse, kids book publishing houses etc while keeping their operations independent. These are the studios pumping out original films/IPs that can be pushed out to other areas. They can acquire these for much cheaper and a higher ROI than another studio.

Having a large back library is great because you can exploit already established IPs but at the same time, there is no guarantee lightning will strike twice. Kinda like this current super hero phase.

Those are all good points, but look at a future in which Comcast's 22-23 million video subscribers declines to somewhere around 16-18 million video subscribers over time.

At the same time that happens, NBCUniversal will need to transition its cable channels more towards a streaming orientation than they already have (for USA, Bravo, Golf, NBC Sports, MSNBC/CNBC, and the rest) as the overall number of paytv subscribers declines towards 60-70 million from the current 90+ million. That's a 25-33% loss in subscribers numbers (i.e. guaranteed monthly revenue).

The question for Comcast is where does it make up that specific content-derived revenue? Comcast's cable broadband will grow from 25 million to 30 million subscribers, and those are very profitable customers, but that alone doesn't "fix" the problems that the video side of Comcast's business faces on both the video subscriber front and loss of NBCUniversal cable channel subscribers.

Only the video side of the business can "fix" itself by capturing a significant enough share of the streaming market that it makes up for the loss in paytv subscribers; or that's the answer Disney has found based on Disney's targeting of Fox's entertainment assets.

If Comcast comes to that same realization, then I'm really not sure where they can go other than Sony Pictures. You brought up a lot of good niche programming studios, but even all of those combined don't generate a half the revenue that Sony Pictures' content alone can generate.

It's a scale problem. Disney will be generating somewhere around $25-30 billion a year in content after purchasing Fox's entertainment assets; they can create a 100 million subscriber global streaming service with that kind of content push. Netflix will pass $10 billion a year in content soon and shoot upwards to around $20+ billion per year by the early/mid-2020s, and they already have over 100 million subscribers.

Can NBCUniversal compete with them with a significantly lower production capability?

 

[quinnmac000]

Those are all good points, but look at a future in which Comcast's 22-23 million video subscribers declines to somewhere around 16-18 million video subscribers over time.

At the same time that happens, NBCUniversal will need to transition its cable channels more towards a streaming orientation than they already have (for USA, Bravo, Golf, NBC Sports, MSNBC/CNBC, and the rest) as the overall number of paytv subscribers declines towards 60-70 million from the current 90+ million. That's a 25-33% loss in subscribers numbers (i.e. guaranteed monthly revenue).

The question for Comcast is where does it make up that specific content-derived revenue? Comcast's cable broadband will grow from 25 million to 30 million subscribers, and those are very profitable customers, but that alone doesn't "fix" the problems that the video side of Comcast's business faces on both the video subscriber front and loss of NBCUniversal cable channel subscribers.

Only the video side of the business can "fix" itself by capturing a significant enough share of the streaming market that it makes up for the loss in paytv subscribers; or that's the answer Disney has found based on Disney's targeting of Fox's entertainment assets.

If Comcast comes to that same realization, then I'm really not sure where they can go other than Sony Pictures. You brought up a lot of good niche programming studios, but even all of those combined don't generate a half the revenue that Sony Pictures' content alone can generate.

It's a scale problem. Disney will be generating somewhere around $25-30 billion a year in content after purchasing Fox's entertainment assets; they can create a 100 million subscriber global streaming service with that kind of content push. Netflix will pass $10 billion a year in content soon and shoot upwards to around $20+ billion per year by the early/mid-2020s, and they already have over 100 million subscribers.

Can NBCUniversal compete with them with a significantly lower production capability?

Comcast doesn't have a real library issue in comparison to Disney/Fox. NBCUniversal has been making and creating shows and movies since 1912 and own all of Paramounts film library up to 1957. Add in all the Polygram, Amblin Partners, Working Title, Focus, and all those other studios they own for film. Then all the properties they own across their television networks which include all those animes, British (Carnival Films/Television) , Australian (Matchbox), and korean/chinese/japaneses dramas no one realizes Comcast has rights to.

All of Disney's acquisitions were directed on Niche. Lucasfilms with Star Wars, Marvel with Superheroes which finally lifted some of Disney's box office troubles.

I'm sure it could be argued the around the $10 billion to acquire both of those companies paid and continue be better ROI than the $60 billion they are paying FOX.

Comcast lately has been buying into extremely niche companies lately: Craftsy, Buzzfeed, Vox, Snapchat. Those companies do not appeal to everyone yet they are very profitable in their lanes.

While Sony is very big and broad; their personally owned IPs film wise are very weak....(Their best selling film of a franchise IP worldwide that they own is the Da Vinci Code which made ~760 million)

So yes they may making 8 billion in revenue over the creation of ~27 films around and all the television show rights/programs, they also are lacking identity which is a huge thing. Would Comcast rather invest in CHIPs/Pixel films which get panned and don't improve the company or its reputation or would they rather invest in something that even if it doesn't get them that high financial revenue at first may but continually pays off due to the critical status of the film due to the amount of awards it received.

Thats the big question, big money= hopefully huge profits but huge downfalls as well. Small money= small profits that may be big in the long term and near nothing losses.

 

[zg44]

Comcast doesn't have a real library issue in comparison to Disney/Fox. NBCUniversal has been making and creating shows and movies since 1912 and own all of Paramounts film library up to 1957. Add in all the Polygram, Amblin Partners, Working Title, Focus, and all those other studios they own for film. Then all the properties they own across their television networks which include all those animes, British (Carnival Films/Television) , Australian (Matchbox), and korean/chinese/japaneses dramas no one realizes Comcast has rights to.

All of Disney's acquisitions were directed on Niche. Lucasfilms with Star Wars, Marvel with Superheroes which finally lifted some of Disney's box office troubles.

I'm sure it could be argued the around the $10 billion to acquire both of those companies paid and continue be better ROI than the $60 billion they are paying FOX.

Comcast lately has been buying into extremely niche companies lately: Craftsy, Buzzfeed, Vox, Snapchat. Those companies do not appeal to everyone yet they are very profitable in their lanes.

While Sony is very big and broad; their personally owned IPs film wise are very weak....(Their best selling film of a franchise IP worldwide that they own is the Da Vinci Code which made ~760 million)

So yes they may making 8 billion in revenue over the creation of ~27 films around and all the television show rights/programs, they also are lacking identity which is a huge thing. Would Comcast rather invest in CHIPs/Pixel films which get panned and don't improve the company or its reputation or would they rather invest in something that even if it doesn't get them that high financial revenue at first may but continually pays off due to the critical status of the film due to the amount of awards it received.

Thats the big question, big money= hopefully huge profits but huge downfalls as well. Small money= small profits that may be big in the long term and near nothing losses.

Yeah, the big difference between the earlier purchases and this one by Disney are that the earlier ones were about growing their franchise business signficantly whereas any acquisition of Fox's assets is much more about TV/streaming content.

Of the $60bn of Fox assets: 25% of that is regional sports networks, another 10-15% is FX/National Geographic, 20-25% of that is their stakes of 39% of Sky/30% of Hulu/Star India, and then around 20% is Fox television production and 20% is Fox movie production.

If I had to rank the assets in terms of importance to Disney, I'd put the movie production at the very bottom. Why? Because everything else is much more important to any streaming setup.

The RSNs will naturally feed into the upcoming ESPN related streaming service. The FX/National Geographic content and Fox television studio's scripted series will allow Disney to target adults with streaming content.

Owning 100% of Sky will give them the largest broadcaster in Europe as well as Star India which produces a ton of content in India. Both of those are key to any global streaming service for Europe/India. 60% of Hulu.

The Fox movie studio has some franchises that have done poorly recently as well as X-Men and Avatar, but those rights are just a tiny fraction of this $60bn in perspective. Fox Searchlight is a good piece, and Fox has a good library, but the Fox movie studio (including Blue Sky) is arguably the weakest part of the assets that Disney would buy.

It's just really hard to substitute for those pieces above, especially Sky/Star India/majority of Hulu. I'd think Comcast would have those as its top choice assets if it could buy them separately from the RSNs/Fox studio/FX.

 

[ThemeParks4Life]

Comcast is an ISP, even with streaming they are making money because people require internet and still is easiest access is through cable/fiber.

I think Comcast/Universal Pictures are starting to learn the current studio set up isn't working well. The truth of the matter people who work for the head studio are being spread thin across multiple projects and its reflecting strongly with the products that are being released on the movie side.

Ironic once they broke out their television into multiple divisions, now they are starting to do extremely well with well received shows both critics and general public alike.

Personally, I think Comcast would be wisest if they invested more resources into content creators to acquire them such as Gkids, Laika, Sanrio, Cartoon Salon, Studio Ghibli, EuropaCorp, Scream Factory, A24, Studio Mir, Shonen Jump, Blumhouse, kids book publishing houses etc while keeping their operations independent. These are the studios pumping out original films/IPs that can be pushed out to other areas. They can acquire these for much cheaper and a higher ROI than another studio.

Having a large back library is great because you can exploit already established IPs but at the same time, there is no guarantee lightning will strike twice. Kinda like this current super hero phase.

Why A24? They serve the same exact purpose as Focus. Universal (and any major studio for that matter) does not need two independent branches.

 

[quinnmac000]

Why A24? They serve the same exact purpose as Focus. Universal (and any major studio for that matter) does not need two independent branches.

Focus is moving away from buying up independent films and producing whereas A24 simply purchases them.

Look at all of Focus films this year: atomic blonde, the darkest hours, Phantom Thread, etc were all in house productions rather than indie creations.

 

[Nick]

If this deal goes through, probably no matter to who, how much do you wanna bet a new version of Sound of Music will get made? If Disney is willing to do it to Mary Poppins, they sure would probably love to do the same to Sound of Music. Both are iconic and the name alone will make the money for them.

 

[AlexanderMBush]

If this deal goes through, probably no matter to who, how much do you wanna bet a new version of Sound of Music will get made? If Disney is willing to do it to Mary Poppins, they sure would probably love to do the same to Sound of Music. Both are iconic and the name alone will make the money for them.

To be honest, I can easily see a remake in the order of process, as it isn't exactly something that you can make a sequel out of.

If Disney gets Fox's Entertainment IP and considers to tackle that, I can easily see Rob Marshal transition from Poppins or possibly Mermaid to do a new take on the classic musical/story.

 

[Nick]

To be honest, I can easily see a remake in the order of process, as it isn't exactly something that you can make a sequel out of.

If Disney gets Fox's Entertainment IP and considers to tackle that, I can easily see Rob Marshal transition from Poppins or possibly Mermaid to do a new take on the classic musical/story.

That's what I meant, remake not sequel

 

[Paulio]

If this deal goes through, probably no matter to who, how much do you wanna bet a new version of Sound of Music will get made? If Disney is willing to do it to Mary Poppins, they sure would probably love to do the same to Sound of Music. Both are iconic and the name alone will make the money for them.

They'll have to get 20th Century Fox to agree with it. Remember, Disney can't revert any Star Wars movies back to their original edits due to the contract with Lucasfilm despite being under Disney (as of December 10, 2017, the Libary of Congress refuses to add the 1977 Star Wars movie as "culturally significant" because George Lucas constantly submitted the 1997 and 2004 editions instead of the original one). Pixar is still doing its own thing and if the Disney CEO wants them to get them to do something, Pixar executives would have to agree. Only Walt Disney Animation Studios can a Disney CEO tell them what to do. Besides, Disney likes doing and remaking their own things first (i.e., created through its own created subsidiaries such as Pixar and Walt Disney Animation Studios). Anastasia (2oth Century Fox) is not going to be a Disney princess ever, any more different than labeling Princess Leia from Star Wars (Lucasfilm) and certain female characters (e.g., Black Widow) from Marvel Comics as Disney princesses.

 

[AlexanderMBush]

They'll have to get 20th Century Fox to agree with it. Remember, Disney can't revert any Star Wars movies back to their original edits due to the contract with Lucasfilm despite being under Disney (as of December 10, 2017, the Libary of Congress refuses to add the 1977 Star Wars movie as "culturally significant" because George Lucas constantly submitted the 1997 and 2004 editions instead of the original one). Pixar is still doing its own thing and if the Disney CEO wants them to get them to do something, Pixar executives would have to agree. Only Walt Disney Animation Studios can a Disney CEO tell them what to do. Besides, Disney likes doing and remaking their own things first (i.e., created through its own created subsidiaries such as Pixar and Walt Disney Animation Studios). Anastasia (2oth Century Fox) is not going to be a Disney princess ever, any more different than labeling Princess Leia from Star Wars (Lucasfilm) and certain female characters (e.g., Black Widow) from Marvel Comics as Disney princesses.

If Disney accquires all of Fox's entertainment assets, I would think that it cuts the middle man, and that the people that would have to have control, is someone like Alan Horn.

Kevin has stopped talking to Ike, and has been going to Alan more now, and considering that Kathleen probably does the same, I would assume that it wouldn't be anyone in Fox's decisions to make.

But perhaps I'm wrong, but I thought that would be something that would have to happen, as they would now have to probably restructure all of the entertainment assets to make it more unified (while being highly diversive, becoming the next Touchstone).

 

[ThemeParks4Life]

Comcast is officially out:

Exclusive: Comcast drops bid for Fox assets, leaving Disney in pole position | Reuters

 

[Paulio]

Kiss American Horror Story for HHN goodbye.

 

[AlexanderMBush]

Kiss American Horror Story for HHN goodbye.

I would assume they would have AHS at HHN for a good while, depending on how long the contract lasts.

 

[zg44]

Comcast is officially out:

Exclusive: Comcast drops bid for Fox assets, leaving Disney in pole position | Reuters

Not too big of a surprise at this point. The redundancy of the RSNs were probably the biggest problem for Comcast given that it already owns a lot of those, and there'd be serious anti-trust issues if Comcast tried to take over the Fox RSNs.

As I said above, I think the company that Comcast would take a longer look at is probably Sony Pictures if Sony ever wants to exit the tv/movie production business, since there'd be no anti-trust problems with that kind of takeover.

 

[Paulio]

I would assume they would have AHS at HHN for a good while, depending on how long the contract lasts.

Pretty sure once the pre-production deals are done, Universal is gonna have to look somewhere else for HHN and license more properties.