On Monday, a big deal was announced that Discovery Communications would acquire Scripps Networks. The new company will now control about a fifth of the advertising-supported pay-television audience in the US, with this new deal being aimed at gaining more female viewers.
The talks took place amid broad consolidation in the telecommunications and media industries in the United States. Over the past several years, cable and broadband providers including Comcast, Charter, Verizon and AT&T have steadily increased their market presence. That has put pressure on TV companies like Discovery to grow in size as a way to gain leverage in negotiations with cable distributors.
When I heard about this deal on last week’s episode of “Deal of The Week,” the first thing I thought was that we will see more like it in the coming years as regular cable is phased out and more a la carte options will become present because of providers like Netflix, Hulu, Prime, HBO Go, etc. Does anyone in this space have a unique view on this? If so, do you think there will be more consolidation in the near future?
Also for this specific deal, do you think they could see an exit by selling to a Netflix/Hulu/Prime buyer?
