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January 2, 2018
Illustration of a reel of film strip

The Fox & The Mouse

Breaking down some major aspects of the recently announced Disney-Fox Deal

On December 14th, 2017 it was officially announced that The Walt Disney Company would buy $52.6 billion of 21st Century Fox creating the biggest Hollywood merger in history. In the deal Disney CEO Bob Iger will stay on until 2021 to oversee the merger.  Rupert Murdoch, the CEO of Fox has a positive outlook on the merger “I’m convinced that this combination, under Bob Iger’s leadership, will be one of the greatest companies in the world. I’m grateful and encouraged that Bob has agreed to stay on, and is committed to succeeding with a combined team that is second to none.”

What was formerly an empire of television networks, movie studios, a news network is now a former shell of its former glory. Disney’s acquisition of Fox is just another in a large lineup of studios and companies they have bought over the years. Here are some major points of the Disney-Fox deal.

Box Office Wins & Woes

The Walt Disney Company constantly dominates the box office with 2017 winners like Beauty & The Beast, Thor: Ragnorak, and Star Wars: The Last Jedi. Now, with the acquisition of Fox, particularly its film division, Disney will continue to dominate at the box office; practically smash it to smithereens à la The Incredible Hulk (Now owned by Disney as a result of a fortuitous deal). A single studio having major control over the box office, and a large portion of television content is alarming, and it’s prompting the US Senate to conduct an investigation. Will it be worth it to finally see the X-Men fight alongside with the Avengers? Maybe, but don’t celebrate too prematurely, Mickey!

Fun Fact: Did you know The Simpsons predicted Disney buying Fox in an episode that aired 19  years ago?

A Better Reach For Advertisers

While the Disney-Fox deal might not benefit everyone, advertisers could see benefits. Now with the vast array of content Disney will own, targeting specific audiences can be much easier. Jonathan Cohen, a principal brand analyst for Amobee explains using fans of the popular superhero genre as an example: “…if an advertiser approaches Disney about wanting to target superhero fans, a buy around Agents of S.H.I.E.L.D. on ABC could be up-sold to include purchasing ad time around Legion on FX and Runaways on Hulu, a platform Disney will now own a majority of. Being able to better monetize genre content could also benefit consumers, as the more revenue it generates, the more likely similar shows will be green-lit.” Companies wishing to reach more targeted audiences might sink more money into Disney properties, leaving other companies out in the cold.

New Content & More Control

With the new merger Disney inherits Fox’s television channels Fox, FX, FXX adding a wealth of television content to its inventory. Disney will now own beloved classics like The Simpsons and hits like Brooklyn 99, along with many other shows. In addition to the bulked up inventory, Disney will also take on Fox’s stake in Hulu. Before the deal, Disney held a 30% stake in the company, but once and if the deal goes through it will have a 60% stake in the company, owning more than half.  Essentially, Disney will have more control over Hulu, and what content is available on the platform. Disney CEO Bob Iger, in an interview with Vanity Fair explains what Disney could do with Hulu in the future,  “Owning a third of [Hulu] was great—but having control will allow us to greatly accelerate Hulu into that space and become an even greater competitor to those already out there. We’ll be able to do that not only by putting more content in Hulu’s direction, but by essentially having control to the extent that managing Hulu becomes a little bit more clear, efficient, and effective.” Will Hulu become the all-Disney streaming service that has already been proposed? Will you still be able to binge every episode of Seinfeld? At the moment, only time will tell.

What the Disney-Fox merger really means is that major change are coming. As Disney keeps acquiring studios and content it will continue to grow. Will it become the uncontrollable monster people fear? Keep an eye out, we know we will.