Headlines on New York Times, March 20th, 2019, read: “Disney moves from Behemoth to Colossus with closing of Fox Deal”. It was and continues to be the prevalent opinion of the masses as The Walt Disney Company (Disney) acquired Twentieth Century Fox (Fox), accommodating almost whole of its assets for a whopping US$ 71.3 Billion thus marking one of the most notable developments in the entire world media in the previous immediate 50 years. We shall traverse this significant advancement by going beyond the headlines and thus simplifying it.
The multi-billion-dollar deal commenced the modification of the famous marvel Big Six to Big Five that is accountable for roughly 90 percent of media output. Among other assets, the takeover of 21st Century Fox by Disney incorporated the 20th Century Fox film and television studios, U.S. channels that comprise of FX, Fox Networks Group, a 73% stake in National Geographic Partners, and the renowned Indian television broadcaster, Star India. The deal also included film licenses to several franchises owned by Fox, like X-Men and Fantastic Four, and the distribution claims to Star Wars: Episode IV – A New Hope. Disney also received Fox’s 30 percent stake in Hulu, an American video-on-demand service. Recognizing that Disney commanded 30 percent shares of Hulu well before the Fox deal, its ownership stake in the streaming service is now 60 percent, making it the majority owner.
Although this complete acquisition is only the fourth-largest in this industry, analysts gather that this venture will have a huge prolonged impact on the entire media enterprise. This deal will also leave a long-ranging mark on the influence of Media Mogul ‘Murdoch Family’, a very well known dynasty of the industry.
Shortly after the acquisition, board members of 21st Century Fox, through a very skillfully planned layout, spun off some of Fox’s subsidiaries like Fox Television Stations and Fox News Channel into the afresh formed Fox Corporation. To accomplish approval from antitrust regulators throughout the world, Disney also had to process the selling of Fox’s 22 regional sports channels, a move required by the Justice Department under the laws of the US government to prevent the overpowering dominance of Disney in the sports television platform.
This acquisition came with its own set of challenges.
The constant dialogues between both parties and the tough negotiations that ensued were keenly watched by the entire industry as and when they took place. A heated bidding war between Iger and Roberts, both celebrated Hollywood executives of Disney and Comcast respectively, too occurred leading up to the ultimate deal and had grown into one of the most intimately observed narratives. Comcast, an American telecommunications conglomerate had bid $65 billion for the procurement after the last proposal by Disney. Disney retaliated to the most recent proposal of its rival by a $71 billion bid. Throughout the bidding war, 21st Century Fox’s value surged 36%.
According to reports by multiple news agencies, Disney could fire at least 4,000 people to streamline the processes and lay off people who are conducting duplicative tasks. As of August 2019, almost 250 film staffers had already lost their jobs. It, however, remains unclear as to how many more positions will be axed or have already been lost in the aftermath of the acquisition. Another question that too remains unanswered is, how will this affect the consumer? The response, according to critics, is that the consequence will be gigantic over time. What needs to be seen is whether it will be supportive or destructive.