Technology

Will The Disney-Fox Deal Be The Death Of Netflix?

As of this recording Disney is close to sealing has sealed the deal on acquiring $60 billion dollars worth of Fox’s movie and TV assets.

That means disney will take over channels like FX and own characters like the Simpsons and X-Men.

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Now Disney is the master of acquisitions.

Disney Netflix Movies
harryHermione / Pixabay

Pixar, Marvel, Star Wars… all those were great business moves, but even better was acquiring ABC and ESPN back in 95’.

Disney saw the powerhouse that cable television was becoming and jumped in the game.

It was a smart move because ESPN became one of the most watched cable networks.

Sportscenter gave guys everywhere even more opportunities to ignore their significant others.

ESPN, together with the company’s other networks, ended up generating nearly 70% of Disney’s profits.

Until streaming started killing cable of course.

And that’s the big reason Disney is acquiring Fox.

The plan is to move from domination of the dying cable TV industry to domination of streaming.

Now even though I love good ole’ Disney CEO Bobby Iger with all my heart… he screwed up when streaming first came on the scene.

As a horizontal media company, Bobby was only focused on making great content that no one could compete with.

Then he would find distributors to move that content.

So when Netflix came around he thought they were just another distributor. He sold rights to distribute.

What Bobby didn’t realize was that Netflix was actually a huge threat to his biness!

Not only was Netflix killing Disney’s cable TV money by giving people the option to “cut the cord”... but they even started creating their own great content to compete with Disney’s.

This Fox acquisition is all apart of the plan to remedy that.

Together with Fox, Disney will have a ton of content that people love to binge.

Estimates say that in terms of external content, Fox owns 8 of Netflix’s most streamed shows and Disney’s already got 6.

So it’s not hard to take that content away from Netflix and throw it on their own streaming service.

This would be a huge shift for Disney away from the horizontal model of only making content and then letting others distribute it…

To a vertical model where they make content and then distribute it themselves.

They’ll own their whole ecosystem from top to bottom.

The acquisition of Fox also doubles Disney’s ownership in Hulu to 60%, giving them the option to use Hulu as base for their streaming services.

Disney has a good opportunity here to become a significant competitor in the streaming game.

Netflix is about to face some real competition from a highly effective company.

And I think that’s great for us consumers.

Competition keeps goliath companies like Netflix in check.

And it’s also nice that this competition is coming from outside the tech space.

It’s Disney gaining power here, not Amazon Prime again.

Cause do we really need another FANG company taking over?

Sure tech companies’ dominance has been great for the consumer so far, with things like huge selections, super low prices, free and fast shipping, etc., etc.

But when there’s no real competition, there’s nothing keeping these almost-monopolies in check.