Disney/FOX Exhibition Repercussions

December 14, 2017 10:07 pm Published by Leave your thoughts

So Disney have acquired 21st Century Fox (TV and Film Studios) in deal that is worth around £39 billion ($52 billion). So is this Hollywood’s response to take on streaming giants NETLIX, Amazon, Apple and Facebook?

So not only does this deal include the 21st Century Fox film and television studios, but also 300+ channels and sporting networks. It also includes SKY broadcasting in the UK and AUS. HULU, the premium video steaming service, is also included and increases Disney’s stake to 60%.

This brings Disney towards the leading position as the world’s leading media company, which now boasts titles such as X-MEN, Deadpool, Planet of the Apes, Marvel, Star Wars, Pixar animations and the Simpsons!

This is a clear response to the ever changing steaming world. Disney CEO Bob Iger said in a call with investors and analysts:

“This acquisition reflects a changing media landscape increasingly defined by transformative technology and evolving consumer expectations,”

Although the deal will still need to be approved by regulators and both sets of shareholders, it is expected that this deal will close in 12 to 18 months.

This acquisition will give Disney the deep pockets they need to take on Amazon and NETFLIX. As we have seen, these companies have an eye watering amount of money to use in to their media production units.

Interestingly, this seems to be the next step in Disney winning the streaming war (that’s not yet started). In August, Iger said that Disney would end the deal that gave NETFLIX their most popular movies and would instead launch it’s own services – including a new Star Wars TV series starting in 2019. Iger suggested that Hulu would become a likely resource for adult-focused programming, whilst the Disney brand would become a home for Disney, Pixar and Marvel.

With over 40% of the box office down to FOX and Disney, this could have repercussions for movie theatres also. Gizmodo are reporting that Disney have made some high demands for theatre owners to show the latest Star Wars film. Whilst most Hollywood studios ask for 55% ticket-sales revenue, Disney are asking for 65% in this case. Not only that, they are also demanding that they reserve four weeks for the film in their largest screen. Just say no? Well, that’s OK .. but Disney will also charge you another 5% on top of this. With Disney films taking over 25% in box office returns, theatre owners won’t want to pass on this deal.

Actually, this won’t come as a surprise to NETFLIX, who has recently increased the amount of money for producing orginal television and films in 2018 to an eye watering $8 billion. It seems that NETFLIX wants to control its own future, rather than relying on third parties, to create over 50 percent original TV and film content. This will include, according to Chief Content Officer Ted Sarandos, 30 new anime series and 80 new original films. However, thinking about it, they could achieve the 50% goal sooner than expected if they keep losing titles.

However, we are clearly moving away from an era where it was easy to access a wide library that with a wide breadth and depth of film choice. This could be the start where there are a number of services with clear markets and, if you want individual movies that aren’t available, you’ll have to pay for these via Amazon or Apple. With a decrease of working torrents and a crackdown on piracy, maybe this will be known as the golden age of media options.


References:

https://io9.gizmodo.com/disney-to-theaters-showing-the-last-jedi-i-am-altering-1820052024?IR=T

https://www.wsj.com/articles/disney-lays-down-the-law-for-theaters-on-star-wars-the-last-jedi-1509528603

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This post was written by noxford

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