Disney-Fox Merger

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By Atisha M., SYBCom


In one of the biggest deals the entertainment industry has ever seen, The Walt Disney Company is all systems go to acquire 21st Century Fox for a whopping 52.4 Billion USD. This mega-deal will include all of the Fox Franchises, except for the Fox broadcast network, Fox Sports, and Fox News. This all-stock transaction has all the potential to change the dimensions of the entertainment industry like never before. If approved by the regulator, the deal will take about a year to close. After the deal is closed, Fox will focus on increasing its footprint in the news and sports sector while Disney will look into the entertainment business.
   
Here we take a look at some of the implications and some concerns that surround this deal.


 THE FUTURE OF CONSUMERS

     With Disney, No.1 studio in the world, acquiring most of Fox, No.3 studio in the world, what is most intriguing is what kind of a future the deal brings along for its customers. The mega-merger is all set to bring consumers of two different , mammoth studios under one roof.
So it is safe to say that The Walt Disney Company will witness increase in their no. of consumers, in leaps and bounds in the near future, provided they offer their customers, great deals at reasonable prices. 
    Marvel Studios, owned by The Walt Disney Company earlier had sold film rights of few Marvel characters to some major studios. While Sony got Spider-man, Fox acquired X-Men and Fantastic Four. Now with this acquisition, these popular franchise of X-Men and Fantastic Four will see their rights return to Marvel Studios, which already owns a notable number of famous Superhero characters. Disney's film library will also include James Cameron's Avatar, with its Four sequels yet to be released. Disney plans to "create richer, more complex worlds of inter-related characters and stories that audiences have shown they love". 
A very unlikely mingling between these hugely famous Characters may well be up and coming.
   It will be interesting to see how Disney will set forth changes in its deals with its consumers, with addition of a huge coveted film library to its collection.
         

MEDIA CONSOLIDATION

       One major concern that surrounds this deal is that this all-stock transaction, biggest of the time, will lead to Media Consolidation. This acquisition, leaves The Walt Disney Company with only four major rivals in the entertainment business viz. Sony , Paramount, Universal, and Warner Brothers. The convergence of these two media giants under one banner leaves very less scope for competition from other rivals, since all other major studios depend on other sources for revenue. Disney-Fox monolith will dominate the Box Office Business for the coming years. At last, with such powers vested in the hands of Disney we can only hope they use it wisely.


STREAMING WARS

          Disney is all prepped to grow its foothold in streaming services now with most of Fox under its control. This means, Disney will now enter the picture and will be a huge competition to other well financed, internationally emerging tech giants like Amazon and Netflix.
      Robert Iger confirmed that Disney will launch its new service in 2019 which will consist of adult oriented content, unlike its existing service Hulu that focuses on Family entertainers. Also, with approval of this merger Disney will acquire Fox's interest in Hulu, giving it a majority stake and freedom to make major changes. 
       Thus, it is very likely that we will see these big names of today go against each other, in context to this established trend of streaming services.



   Whatever the implications, The Disney- Fox mega-merger, if approved, is fated to change the face of the Entertainment Industry in a way only some can imagine.

-Disha P., FYBA.

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