Rumor no more: Comcast confirms it will try to outbid Disney for Fox
Comcast has made it official: The Internet and pay-TV provider plans an all-cash offer to outbid Disney’s $52.4 billion bid for 21st Century Fox’s movie and TV studios.
The move, after weeks of speculation that it might make such a bid, sets up a clash of media titans fighting to bolster their holdings to compete with deep-pocketed tech companies such as Netflix, Apple and Amazon that increasingly fill Americans’ entertainment needs.
Philadelphia-based Comcast, which also owns NBC Universal, released a statement Tuesday confirming it is considering an offer that would be “at a premium to the value of the current all-share offer from Disney.”
Comcast did not mention an actual amount of its bid in the statement, but earlier news reports have estimated that Comcast’s bid would be about $60 billion for Fox’s studios, its onethird stake in Hulu, Fox’s 22 regional sports networks and its stake in U.K.based satellite TV and Internet provider Sky.
Comcast shares fell almost 2%, while Disney shares lost about 1%.
Disney CEO Robert Iger has championed the Fox acquisition as integral to the company’s goals of expanding an already-impressive content catalog and increasing the strength of its planned subscription movie and TV service.
Fox’s regional sports stations would buttress Disney’s ESPN networks and its recently-launched ESPN+ streaming service ($4.99 monthly). And the Fox TV and movie studios could strengthen Disney’s box-office dominance and provide more content for its exclusive movie and TV subscription streaming service, expected to launch in late 2019.
The deal would establish Disney as a “content king” and give Iger “a clear runway to gain market and mind share from the likes of Netflix,” Daniel Ives, head of technology research with market research firm GBH Insights, said in a note to investors Tuesday.
That edge would evaporate if Comcast succeeds. Fox also would lose — and Comcast stands to gain — a majority stake in streaming service Hulu. Currently, Disney, Comcast and Fox hold
30% stakes, with Time Warner holding
10%.
The victor would also become a player in international content distribution as the deal includes Fox’s 39% stake in Sky, which has 22.5 million pay-TV and broadband customers across the U.K. and Europe, including Austria, Germany and Italy. The Murdoch family — Rupert Murdoch and brothers James Murdoch and Lachlan Murdoch — which controls Fox, is attempting to buy the
61% of Sky it does not own, but U.K. regulators have stalled that transaction.
Comcast also interceded in that deal three months ago with a $31 billion bid for the bulk of Sky.