Note that Netflix' market cap right now is $392.8 billion dollars. Disney is worth $108.7 billion; Fox is worth $44.5 billion; Warner Bros. is worth $77.2 billion. Paramount is embedded with CBS/Viacom, and Universal is part of NBC/Comcast, and Sony Pictures is of course part of Sony, so all of these are hard to guestimate, but I bet they'd be well under $75B for each. What I'm telling you is that Netflix is worth more than every Hollywood studio combined. Netflix has been doing extremely well lately in terms of content, and it's fair to say they've completely changed the network TV business. The studios are disturbed enough to ask for rules that make it more difficult for Netflix to be nominated for any Oscars, but they're pushing for a way around this. The trade press is having a field day reporting on the war between Disney and Comcast to try to buy Fox... Fox Hunt: Disney, It’s Your Move Disney vs Comcast: In the Battle for Fox, Who Needs It More? Could a Tech Giant Swoop Into 21st Century Fox Fray? The latter story has the rumor that a major tech company is also interested in acquiring Fox. Bear in mind that Apple is worth $945 billion dollars right now, so they basically have enough cash to buy every Hollywood studio, every American broadcast network, every American publishing company, and every American record label and still have a lotta cash left over. One reporter concludes: "The one sure thing? The Murdochs are in the catbird seat. It’s good to be Fox.”
That's a matter of opinion. Speaking for myself, I watch and enjoy vastly more Netflix shows than Disney's. In fact, I can't think of too many Disney produced shows that I wanted to watch in many years (well, maybe the odd Pixar movie, but by no means every Pixar movie).
Most Wall Street analysts are mystified that Apple with their humongous cash reserves doesn't want to buy into Hollywood. It's more wishful thinking feeding those rumors than anything else. But Amazon/Facebook/Netflix are the tech companies to keep an eye on. I would wager at least two of that trio have some Hollywood piece within the next 18 months.
Which is what they need to be doing, but it'll take them time to amass a library like Disney or Fox has. What I'm saying is that anybody spending zillions to acquire a content library would probably be better-served just taking that money and spending it making their own content, because my suspicion is those libraries aren't going to offer the return on investment people are currently assuming they will. There are several reasons for this: 1) The middle class is in collapse and won't have lots of money to spend paying for content going forward. Especially recycled content. Content holders will still be free to sell it, but it's going to fetch much lower prices than people are assuming. 2) The flood of new content from new players like Amazon, Netflix and Google is suppressing the demand - and the price - of legacy content from the likes of Disney and Fox. 3) Different kinds of entertainment and infotainment content from YouTube and Facebook (among others) are gathering more and more eyeballs with each passing day. I've found the various citizen-filmed videos of the current eruption in Hawaii far more interesting than anything on Netflix. They're shorter and I can come and go as I please. This is also going to depress demand for and the price of legacy content libraries going forward. We've seen this kind of nuttery before though, like when AOL bought Time Warner and then the bottom fell out.
Apple is in the process of opening a 50,000 square foot office for Apple TV in Santa Monica and has said they'l be spending $1 billion a year on original programming. Beyond that... your guess is as good as mine. I would rather they put $20B-$30B in buying a studio than spending $3 billion on Beats Headphones.
I have the feeling that Netflix is going to acquire a major studio at some point simply for their library of films and television shows. They are at the mercy of other studios and, yes, they are producing original content but they certainly will need more otherwise they will be at the mercy of the studios. It seems like everyone wants to start their own streaming channel now. Disney will eventually pull the Marvel films from places like Netflix and make them exclusive to their channel (same with the Star Wars films).
All I want to know is how much closer are we to getting the original theatrical releases of the Star Wars Trilogy on blu ray?
I really don't think so. Netflix's access to legacy studio content has been dwindling for many years now, and yet they continue to grow by investing in original content, which includes TV series, movies, documentaries, comedy and even some live events. They continue to rack up new customers, year after year. Old, legacy content is increasingly becoming less relevant and the younger demo really doesn't care much about watching old 'classic' shows and movies from yesteryear (a generalization, but not far off the mark). If anything, it is Netflix that has shaken things up and the it's the studios that are scrambling to catch up.
I actually think that by pulling their content from services like Netflix, the studios are hastening their demise. Very few consumers are going to subscribe to a dozen different services just to get access to Disney content, Fox content, CBS content, ESPN content, etc. etc. I think the studios would have been a lot smarter to provide access to all of their content - fairly cheaply - to Amazon, Apple, Google, Netflix and Hulu, in order to ensure no one streaming service grew large enough to boss them around. They should have also offered to produce exclusive content in conjunction with the streaming services. The relationship could have been something like the ones the studios enjoyed with various television networks since the '50s. Instead, they seem to have forced the streaming services to become direct competitors, devaluing their own legacy content as it gets overwhelmed by a flood of new content.
Maybe. We are in a dynamic market where things can change fairly rapidly. As more streaming services emerge, there will be more competition for the original programming that Netflix buys. Yes, they have generated their own but, at some point, there will be a finite amount that Netflix can grow and a finite amount of money that they can continue to put into original programming. Older material put out there may be something that younger viewers can discover and its content. If you own the studio, you own all of the assets past and present giving you something that the other guys might not have. I wouldn't disagree that Netflix has changed the market. I agree. I think it's short sighted to pull content and, yes, I agree that it does cheapen their legacy content. Unfortunately, there will be some legacy content (particularly the older stuff) that will have a much smaller audience but, with the right streaming model, a Netflix could offer both the popular content as well as "old " stuff. We are also in a global market where folks that might have been unwilling to go see a foreign film will now watch shows from other countries. Doesn't mean everyone will adapt to it however. The problem we will face with devaluing legacy content is the loss and disappearance of films and TV shows much as we faced at the of silent films. The studios felt there was little to no value in the films they kept in their vaults. My fear is that this will indeed lead to the loss of some material that might not have the popularity of the top programs. Streaming is, in many respects, the syndication of today for older programs (some more recent ones as well) but, once we have a limited amount of options, I fear that many of these classic programs will become like those silent movies--forgotten and in some cases lost--except for the popular ones.
I think that's already happening, again because the studios are using their legacy content more than anything to attempt to attract subscribers. It's too fragmented. If the studios were smart, they'd at least cooperate and develop a single streaming service they all provide all of their legacy content via. For awhile it looked like Hulu might be that kind of alternative, but for whatever reason that seems to have not taken off (they also need to get Warner and Paramount onboard).
Besides the obvious anti-trust issues something like that would raise, Hollywood would never give one distributor that much power over streaming. It doesn't make business sense. Most everyone believes we are going to an a la carte system of streaming services for popular entertainment, replacing most cable television. Most people will need to subscribe to 3-5 services for their entertainment needs. I'm sure "bundlers" will eventually arise to offer combined streaming packages.
Well, if they all owned a chunk of the "one distributor", that wouldn't give it all that much power. And it would make perfect sense - they could charge more for a single service and have a much larger audience participate. Anti-trust issues are a non-issue here in the US.
And today, Disney just did this: Disney Boosts Fox Bid to $71.3 Billion in Cash and Stock Rupert Murdoch says: "We remain convinced that the combination of 21st Century Fox's iconic assets, brands and franchises with Disney's will create one of the greatest, most innovative companies in the world." Very hard to argue with that. I'm with the fans who say that Fox's assets would be in much better hands with Disney than Crumcast. I'd just like to see all of Star Wars and the Marvel characters under one roof, and I don't have a problem with Disney having an exclusive on everything in the Fox library, plus Disney, Lucasfilm, Pixar, Marvel, and Muppets.
This is truly a battle of corporate giants. I'm thinking Disney may well be the biggest gorilla here.
If it advances the cause of gettting the Star Wars OT theatrical versions remastered and re-released, I'm prepared to throw the Mouse House a couple bucks if it helps ...
It doesn’t sound like it’s official. They’ve just accepted Disney’s higherbid. “According to FOX Business’ Charles Gasparino, citing his sources, Comcast is plotting its next move, and will likely increase their bid for 21CF’s assets. Gasparino added that ‘banker talk’ has Comcast bidding at least $41 per share.”
Most people believe Comcast is ready to go as high as $80 or even $90 billion for Fox. Most analysts also believe that whoever gets it will end up overpaying. This is a game of chicken.
Yep, I believe that 100%. I just hope Disney is ultimately the victor. We have two evil corporations where they're each trying to buy a smaller evil corporation. I'd much rather have Evil Disney buy them than Evil Crumcast, because there are more benefits for fans that way. More details here: Disney Ups Bid For Fox To $71.3 Billion, 10% Higher Than Comcast’s Disney Ups Fox Bid to $71.3 Billion, Outflanking Comcast In no small way, this is a battle of superpowers, kind of like a Gang of Thrones struggle for one realm to try to take over another realm. It's also a bit like eBay bids: Disney is afraid of being sniped at the last minute.
The company I used to work would never go above 6-8 times annual earnings (adjusted to post acquisition #'s) to acquire another company. Too much risk. Granted we were not in the entertainment industry which is far more volatile.
$392.7 billion and they can't do any better than 20 good movies, 300 lousy ones, and most of the Bollywood catalogue?
