Fox-deal closure allows Disney to take on technology giants

Disney has closed its $71-billion US acquisition of Fox’s entertainment business, putting Cinderella, The Simpsons, Star Wars and Dr. Strange under one corporate roof.

The deal paves the way for Disney to launch its streaming service, Disney Plus, this year. It will also likely lead to layoffs in the thousands, thanks to duplication in Fox and Disney film-production staff. By buying the studios behind The Simpsons and X-Men, Disney aims to better compete with technology companies such as Amazon and Netflix for viewers’ attention and dollars.

Disney needs compelling TV shows and movies to persuade viewers to sign up and pay for yet another streaming service. It already has classic Disney cartoons, Star Wars, Pixar, the Muppets and some of the Marvel characters. With Fox, Disney could add Marvel’s X-Men and Deadpool, along with programs shown on such Fox channels such as FX Networks and National Geographic. Fox’s productions also include The Americans, This Is Us and Modern Family.

The deal helps Disney further control TV shows and movies from start to finish — from creating the programs to distributing them though television channels, movie theatres, streaming services and other ways people watch entertainment. Disney would get valuable data on customers and their entertainment-viewing habits, which it can use to sell advertising.

Disney CEO Bob Iger said in February that Disney Plus and other direct-to-consumer businesses were Disney’s “No. 1 priority.”

Cable and telecom companies have been buying the companies that make TV shows and movies to compete in a changing media landscape. Although internet providers directly control their customers’ access to the internet in a way that Amazon, YouTube and Netflix do not, they still face threats as those streaming services gain in popularity.

Disney gets a controlling stake in the existing streaming service Hulu, which it plans to keep operating as a home for more general programming. Family-friendly shows and movies will head to Disney Plus.