Disney, Fox Are in Talks to Complete Major Merger in Entertainment Industry

The logo for Walt Disney Pictures.

Image: Dean Bertoncelj / Shutterstock

Two of the biggest names in the entertainment industry are preparing to team up. According to the Financial Times, executives at Disney and 21st Century Fox have revived talks regarding a major merger in which Disney would purchase around $50 billion worth of Fox’s international and entertainment-related assets. This would include the company’s 39 percent stake in the pan-European broadcaster Sky.

The negotiations have been largely focused on Fox’s movie studio, its cable channels such as FX, and its international business holdings, including both Sky and Star of India. Analysis from MoffettNathanson has indicated that the total value of the assets sold would make up a significant percentage of the company’s $60 billion total value.

“Disney would gain more scale in TV and film production [and] cable networks, as well as adding its own distribution angle while accelerating its [direct to consumer video] strategy,” the MoffettNathanson analysts wrote in a research note.

For Fox, this potential blockbuster move comes at a tricky inflection point in the company’s history. Fox is separately working to complete a takeover of Sky rather than to merely own 39 percent of the company, but those efforts have run into regulatory trouble. Meanwhile, Fox may still be considering offers from other buyers, as cable TV giant Comcast has also expressed interest in controlling Fox’s entertainment assets.

If completed, this deal would have a major impact on the long-term direction of Disney’s business model. Today’s consumers are increasingly looking to consume TV programming in an “on-demand” fashion, and Disney has been looking for a way to compete with bigwigs like Netflix and Amazon in that realm. Disney is working to develop two new streaming services: one aimed at sports fans and another with more family-oriented programming. Acquiring Fox’s programming would give them a lot more content to beef up those new offerings.

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A Sporting Chance for Cable?

TV

Are Americans finished with TV? Not TV shows, which are just a particular combination of film length and episodic storytelling, but rather the traditional delivery method for them. More is often considered better, and yet that doesn’t hold true with channel choices. The average American home has 189 channels to choose from, according to a 2014 Nielsen Advertising & Audiences Report, a full 60 more than in 2008. And yet with so many viewing options, a mere 17 are regularly used. Consumers identify what they like and then stick with it, rarely exploring the vast scope of additional viewing options remaining to them. This makes the cable bundle seem like an ever-more unsavory option. If, as a consumer, one knows what one prefers, likely has digital recording capability through a cable box or something similar, and can frequently find the same televised content online through websites like Hulu, YouTube, and the network’s own site, why continue paying for an almost 200-channel bundle of scheduled broadcasts?

A large part of the answer lies with the great American pastime and the channel that commands most of the access to it: sports, and ESPN. An independent study by mobile advertising technology company Marchex dug into the details of cable television subscription. They found that almost 40% of subscribers asked cable providers about paying for channels a la carte, with 20% of that group asking specifically about ESPN and another 4% asking about Fox Sports. Live streams of games are largely unavailable online, making ESPN close to a one-stop spot for live sports content. Many consumers begrudgingly retain their cable bundle subscription for the sports alone, but that privileged position may prove not-so-unassailable. Bundle subscriptions are dwindling overall, and Sony’s PlayStation Vue, a web TV service available through the titular video game console, launched without any Disney-owned content – including ESPN. This may lose Sony some customers it otherwise could’ve gotten, but it also demonstrates a willingness to offer TV service without the much-vaunted sports network.

Comcast to Acquire Time Warner Cable

Comcast

IMG: via Comcast

Comcast has agreed to buy Time Warner Cable in a $45 billion dollar deal combining two of the largest cable and Internet providers in the country. In the all-stock deal Comcast will pay $158.82 per share in the friendly merger.

The move comes as a surprise as last month cable operator Charter Communications offered $132.50 a share for Time Warner Cable, but the bid was rejected. In January, Time Warner Cable Chief Executive Robert Marcus said that a merger with Charter wouldn’t have been a good fit and that he preferred to work with Comcast CEO Brian Roberts.

CNN reports that the two companies expect to receive government approval by the end of the year, but regulators will likely take a closer look at the potential impact on consumers. Time Warner Cable is the country’s second biggest supplier of television service. In markets such as New York City and Los Angeles, there are some 12 million subscribers. Comcast has 53.1 million customers with combined TV, broadband, and phone services combined across the country.

With a potential for improved cable and Internet services for consumers, public interest group Free Press has raised concerns over the deal.

“In an already uncompetitive market with high prices that keep going up and up, a merger of the two biggest cable companies should be unthinkable,” the group’s president, Craig Aaron, said in an email. “This deal would be a disaster for consumers and must be stopped.”

Comcast is also the parent company of NBC Universal, which owns the NBC broadcast network, Universal Studios, and several cable channels. The $17 billion acquisition of NBC Universal was completed in 2013.

Netflix Changes Up Their Look

New Netflix Experience

IMG: via Netflix

Netflix user numbers keep growing as the streaming and DVD service becomes more and more popular.

  • 29.8 million in U.S., gain of 633,000 during the second quarter
  • 7.75 million outside the U.S., gain of 605,000
  • 37.6 million total, gain of 1.2 million (source).

Netflix just changed up their game. This morning, they rolled out a new “TV experience.” Netflix calls it “the biggest update in Netflix history to our TV experience.” The new layout will work not only on game consoles, but uses JavaScript, so it will work on all devices.

Apparently these updates have been in the works for a year and a half. The main goal of the change was to make it easier to find new content to watch.

“Our members collectively watch more than a billion hours of Netflix a month, most of that is on a TV,” Netflix’s chief product officer Neil Hunt said in a statement. While Netflix has tons of TV shows, movies and more for users to watch, sometimes finding something new to watch can be difficult if the content is not new or newly added.

Before today, the “flagship” Netflix experience was only available on game consoles and devices such as TiVo. As a result, if you had a Blu-ray player or Smart TV with Netflix, the way you viewed Netflix was not updated.

The new look starts on Wednesday and will hit all Netflix customers globally within two weeks.

Blockbuster to Close All 300 Remaining Stores

Blockbuster_logoI remember a time when I went to Blockbuster multiple times a week to grab a movie. You could scan the wall, see all your options, and then make a decision. The great thing about that store was if you wanted to watch a movie then, you could. But then they started to get expensive. Movies that were once 1-3 dollars were now 5+ and I became a lot more particular about when I went, because it had to be a movie I really wanted if I was willing to shell out 5 bucks.

Netflix and Redbox started to take over. While I love Redbox, they only have a limited amount of movies (mainly new), and you can’t just get anything you want. Netflix is great, but I don’t watch movies enough to pay extra on top of the streaming. On top of that, you have to wait a couple of days for it to ship to you.

After Hollywood video closed, Blockbuster was the last remaining video rental store. It was just announced that they will be shutting down the rest of their 300 stores. The Blockbuster By Mail service will end in mid-December.

The company is owned by Dish, and said that their licensed stores will remain open, and they will keep the licensing rights to the Blockbuster brand and all of it’s videos. Dish is now going to focus on the streaming and on-demand services that Blockbuster (apparently) has.

“This is not an easy decision, yet consumer demand is clearly moving to digital distribution of video entertainment,” said DISH President and CEO Joseph P. Clayton. “Despite our closing of the physical distribution elements of the business, we continue to see value in the Blockbuster brand, and we expect to leverage that brand as we continue to expand our digital offerings.”

Blockbuster filed for bankruptcy in September of 2010. It was purchased by DISH in a bankruptcy auction for $320 million the next year.

Study Finds that 34% of Millennials Watch More Online Videos than TV

Watching TV on Computer

IMG: via Shutterstock

A recent New York Times survey found that 34% of Millennials watch more online videos than they do on an actual TV. That result is a bit shocking, I would think the percentage would be higher. With the lack of jobs out there, a lot of young graduates can’t even afford cable.

Millennials covers the age group of 18 to 34-year-olds. While most generations span about 16 years, I personally think grouping this big age group together doesn’t make a lot of sense. Current 18-year-olds now grew up never knowing a time before cell phones and internet, while those in their mid 20s and 30s clearly remember a time without. Now I will finish my rant and get back to the topic at hand…

The study reported that about one in three Millennials watch less TV than online videos. 50% of those surveyed said they watched online videos at least once per day.

34% of surveyed millennials said they watch mainly online video or no broadcast TV. Only 20% of Generation Xers (Those born in the early 1960s to early 1980s) and 10% of Baby Boomers (born 1946-1964) had the same preference for online videos.

The reasons Millennials gave for watching more online video, 49% said that they like how they can watch it instantly and are able to watch several episodes online.

The study showed that 50% of Millennials who said they watch videos online do so once per day, and 89% said they watch weekly.

Where do you prefer to watch videos?

IMG: via Mashable

IMG: via Mashable

LG to Create a Curved Smartphone

LG Logo

IMG: LG

LG Electronics has announced that they are creating a curved smartphone that will be released in November this year, and showcased later this month.

According to the report, the phone will be called the “G Flex,” and have a 6-inch, curved screen that uses organic light-emitting-diode technology.

OLED screens are thinner and lighter, however they are more susceptible to moisture. Display experts have said that it will be awhile before both Samsung and LG are able to create fully flexible screens. I’m pretty sure anyone would love to buy that phone.

This is not the first time LG has come out with a curved screen. Earlier this year, LG launched 55-inch curved TV sets. Samsung, LG’s big competitor, also plans to launch a curved smartphone sometime in October.

“We do not think transparent and rollable phones will remain confined to concept products forever,” Jae H. Lee, an analyst with Daiwa Securities, wrote in a research note. But, the analyst added, “the challenge of launching flexible displays has been its extremely low production yield due to difficulties in encapsulating OLED displays, since organic materials need to be protected from air and moisture.”

Do you think the curved screen will make any difference, or just feel awkward?

Tina Fey Joins the Cast of ‘Girls’ on SNL

We all remember Liz Lemon, the likeable and funny star of 30 Rock. That, however, was not the kind of character Tina Fey protrayed on her HBO Girls skit on Saturday Night Live. The SNL cast did a great job at portraying the characters, and most of them could almost pass as the girls on the show.

In the skit, Fey plays an old and grungy Albanian women named Blerta who moves in with Hannah. Hannah was excited to hear Blerta had OCD just like her – old cow disease.

Her life advice includes, “Don’t speak,” Blerta said after she slapped Shosh. “If you speak, they will know you are simple. If they know you are simple, they will drown you in river.” I don’t think we’ve ever seen Fey this scary before.

Lena Dunham and fellow comedian actress, Mindy Kaling showed their support for the sketch.

Check out the parody below:

 

Ellen ‘Discovers’ a Deleted Scene from Orange is the New Black

OITNB

IMG: via Instagram

Orange is the New Black is a Netflix Original show that was just released this year. Unlike most shows, a Netflix Original releases all episodes of the season at once. OITNB (as fans call it) took over. Not only does it star some well-known names (Laura Prepon from That 70’s Show and Jason Biggs from American Pie), but it is based on a true story.

If you haven’t heard already, the story follows Piper Chapman (Taylor Schilling), who is sentenced to 15 months in prison after she is convicted of transporting money for her drug dealing girlfriend (Laura Prepon) 10 years earlier.

Many of you (like me) probably flew through the 13 hours of episodes in less than a week, which means your probably having some OITNB withdraws. To combat that, I’d follow them on Instagram, and watch this video below! The sketch of course isn’t real, but maybe Ellen is trying to get a guest role next season (we can wish).

Comedy Central to ‘Roast’ James Franco…But is it Enough to Save Viacom?

James Franco

IMG: s_bukley / Shutterstock

Viacom Media Networks is a ad-supported cable network company based in New York City that brings you a lot of your favorite channels. Shows on MTV, Nickelodeon, Comedy Central, BET, and more come from them.

“Each of the Viacom Media Networks brands develop original content based on the deep insights and connections they cultivate with the audience,” they state on their website.

They (along with Comedy Central) have made headlines for their “roasting” of celebrities. On labor day, Seth Rogen and more funny people will take part in the roast of James Franco. Some might say though, that roasting is an old form of comedy and isn’t “new” enough.

The people who say this are credit rating agencies. Moody’s, whose CEO is Ray McDaniel stated that, “In our view, the company’s recent underperformance has been driven by insufficient investments in programming and innovation,” Moody’s said. “By relying on the success of popular but old shows, its television ratings have suffered across its various networks, particularly at Nickelodeon, and led to a steep decline in advertising revenue which drives about 35% of its total revenue.”

While Viacom may be doing well, they are not coming up with enough new ideas that are different from what we already see. Moody’s suggests that Viacom change up the management team if they expect to be upgraded in the near future.

Click below to watch James Franco’s Roast commercial.

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