Disney may be closing in on a media-industry-rocking deal to acquire a collection of assets from 21st Century Fox. CNBC reports that a deal, which would include Fox’s movie studios, could be announced as soon as next week.
The deal comes as media companies look for ways to survive as consumers shift their attention to ad-free streaming services from Netflix and Amazon, cut the cord in increasing numbers and spend an inordinate amount of time glued to mobile screens and social media.
Disney’s already declared that it is going to war with Netflix by launching its own streaming service. Already Disney has some big assets to offer subscribers to this potential service, including movies made by its own studios and the rights to mega-hits like Star Wars. But it’s going to need as many big guns as it can get in that fight. If the future is less about cable bundles and classic TV advertising, and more about bringing content directly to paying subscribers, giants like Disney can’t stand pat. That’s where Fox comes in.
As one industry observer put it, “nobody knows what the business model of the future is. But if you have a lot of content, you’re either going to get people to pay for it, run ads in it, or license it to somebody. So this is a pretty good hedge for Disney.”
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Alphabet’s (GOOGL) Google unit has reached a final agreement or one in principle with CBS (CBS) , Disney (DIS) , Viacom (VIAB) and 21st Century Fox (FOXA) and could launch its streaming video service as soon as February, according to people with knowledge of Google’s plans.
Time Warner (TWX) is in talks as well, but they haven’t yet progressed as far as the others, said one person with knowledge of the situation.
The video streaming service, Google Unplugged, will be operated by Google’s YouTube service and will join a growing number of subscription video-on-demand offerings lining up to offer consumers so-called skinny bundles of networks that are less expensive than those offered by cable or satellite operators.
The service initially was expected to be announced at the Consumer Electronics Show that begins in Las Vegas on Jan. 5, but unspecified technology delays and the need to finalize contracts have pushed it back to February or later, according to two knowledgeable people.
The crowded field of cablelike streaming services includes DirecTV Now, which AT&T’s (T) DirecTV satellite service launched in November, as well as Sony’s (SNE) PlayStation Vue service and Dish Network’s (DISH) Sling TV.
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