War for Fox: Does Comcast or Disney Have Better Synergy?

5:00 AM 6/20/2018

by Paul Bond

The Fox assets Disney and Comcast are fighting over would initially add about $19 billion in revenue and $3 billion in profit to the victor’s annual financial performance but potentially far more depending on synergies.

'X-Men: Dark Phoenix'
'X-Men: Dark Phoenix'
Doane Gregory/Twentieth Century Fox

  • Films

    Courtesy Twentieth Century Fox

    Comcast
    The conglomerate paid $4 billion for DreamWorks Animation in 2016, and it would love to further challenge Disney’s dominance in family entertainment with Fox’s Blue Sky Studios, whose Ice Age, Rio and Peanuts franchises would help. But Fox’s Searchlight division might be duplicative of Universal’s Focus Features specialty unit.

    Disney
    With Fox, Disney would command a 50 percent share of the box office. “Hard to see how that is a positive for the world,” quips BTIG analyst Richard Greenfield. The Marvel parent would like to get Fox’s rights to X-Men, of course, and the art house fare Searchlight provides could help Disney launch one of its streaming services.

    Fox
    X-Men offers another major comics franchise.

  • Digital

    Sean M. Haffey/Getty Images

    Comcast
    Its massive cable TV product has 22 million subscribers, but it only reaches one-third of the country, and cord-cutting has led to stagnation, so Comcast is constantly mulling ways to compete with streamers. Could the addition of Fox’s content encourage it to take on Netflix with its own streamer?

    Disney
    Disney launched its ESPN Plus streaming service April 12, and with Fox’s 22 regional sports networks, rights for local games could eventually go there. Additionally, Disney is launching its own Netflix competitor in 2019, so a large chunk of Fox TV shows and movies would end up on that.

    Fox
    Fox owns 22 regional sports networks. 

  • Television

    Courtesy of Dusan Martincek/National Geographic

    Comcast
    NBCUniversal, home to Syfy, USA Network and Bravo, is always on the hunt for popular networks, and Fox’s Nat Geo and FX fit the bill. Its weakness is overseas, so it particularly craves Fox International Networks, Star India and Fox’s 39 percent stake in U.K. pay TV giant Sky.

    Disney
    Nat Geo also fits nicely alongside the Disney Channel, Disney XD, ESPN and A&E Networks (of which Disney owns 50 percent). Fox produces Modern Family, a top show on Disney’s ABC. Other series it would own should it acquire Fox include ratings winners like Empire (Fox) and American Horror Story (FX).

    Fox
    Nat Geo's Picasso could be a fit on A&E. 

  • Theme Parks

    Stephen Shugerman/Getty Images

    Comcast
    It’s hard to imagine Universal Studios, now in four locations with three more in development, not creating attractions based on Planet of the Apes and Titanic should it get ahold of those Fox franchises. It already has attractions based on The Simpsons through a licensing deal with Fox.

    Disney
    Fox has four more Avatar movies in the works, and Disney recently opened Pandora — The World of Avatar at one of its Florida parks. With Fox, it could put Simpsons attractions in Europe and Asia, where Universal hasn’t locked up the rights.

    Fox
    Universal Studios has a Simpsons attraction. 

    This story first appeared in the June 20 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.