The Walt Disney Company announced Thursday it reached a $52.4 billion deal to buy a large part of 21st Century Fox–a consolidation of two of the biggest movie studios in Hollywood that could dramatically alter the media landscape.
As part of the deal, Disney will acquire a majority of assets that make up Rupert Murdoch’s media conglomerate, including the National Geographic and FX cable networks, Fox’s regional sports networks and television studio (which produces TV shows such as “This is Us” and “Modern Family” for other networks), and stakes in international service providers. Disney will also get Fox’s 30 percent stake in Hulu, positioning itself to compete with major streaming services such as Netflix and Amazon.
Robert A. Iger, Disney’s chairman and chief executive, said the merger would cater to “the increasing consumer demand for a rich diversity of entertainment experiences.” The $52 billion sell-off may also affect your TV bill, habits, and what’s available. Here’s how:
Higher prices for your cable bundle
The 22 regional sports networks that Disney would acquire under the deal are expected to be rebranded under ESPN, which Disney already owns. That would give the company leverage to increase fees from satellite and cable distributors. Those costs will likely be passed onto consumers in the form of higher TV bills, according to Forbes.
Different streaming content available
The agreement will give Disney an overall 60 percent stake in Hulu (adding to the 30 percent Disney already owns), making it a larger player in the streaming landscape that is now controlled by Silicon Valley digital giants such as Apple, Google and Netflix. Disney announced in August it intends to remove its content from Netflix and already has two subscription services in the works: ESPN Plus, which will arrive in the spring, and an entertainment streaming service with movies and TV shows that will launch in 2019. With more control over Hulu, Disney will be able to increase its on-demand streaming offering and become a more effective competitor to its rival Netflix.
But with Disney having a majority stake in Hulu, Recode says Comcast, the NBC parent company that owns a smaller portion of Hulu, may be hesitant to sell its shows to Hulu, which could also result in a loss of content for consumers.
Broader access overseas
Nearly 23 million homes across Europe will have access to Disney’s content after the merger, which gives the company a 39 percent stake — and possibly full ownership — in Sky, a major European pay-TV provider based in the U.K. An additional transfer of Star, a leading pay-TV provider in India included in the deal, could also help Disney have greater global reach, according to Variety.