Merger and Acquisitions of Media Giants

Merger and Acquisitions of Media Giants
Recently, the media industry may face a lot of separation and restructuring. According to FT.com, Comcast, Verizon and Disney, all three have been in talks with 21st Century Fox. These companies are all traditional media companies. Under the current development of science, traditional media faces the pressure from technology, viewing habits and the rise of Internet.



Such a restructuring between the media giants is bound to attract the attention of regulators. Despite Comcast's successful acquisition of NBS Universal, it is because competition regulators want to know why behavioral therapies failed to protect consumer interests and competition. as a result, AT&T's acquisition of Time Warner is still under regulatory scrutiny. Because antitrust authorities have repeatedly shown that opposed to media distributors controlling the content producers.

In fact, Time Warner was once acquires by America Online, the largest acquisition in the history of the United States, But also the most unsuccessful. In order to integrate mass media and the Internet, America Online acquired Time Warner in a megamerger for $165 billion in 2001. At that time, both the media industry and the Internet industry were generally optimistic about the combination of old and new media. Also, after the formal merger in 2001, the new company rose from 271 to 37th in the fortune 500 rankings. However, soon after, the dotcom bubble burst, causing the company's value to plummet. In 2002, the company reported a staggering $99 billion in losses.

Aol Time Warner also received the European Union and the us federal trade commission antitrust review, the approval process lasted for about one year, and required the combined conditions: must be open instant messaging services, and allow Internet users to use in addition to the America Online network suppliers. This has largely cut back on the interests of Time Warner and America Online. Yearlong antitrust scrutiny greatly slowed the pace of America Online and Time Warner merger and acquisition, gave competitors more response time, and eroded the enthusiasm of investors and the public.

Given the America Online and Time Warner examples, I don't think AT&T's acquisition of Time Warner and other companies such as Disney's merger tails with Fox might have a positive outcome. After all, America's department of justice has asked AT&T to sell its cable networks or satellite broadcasters to get approval for the deal. Because the media giant's merger and acquisition could harm media diversification.



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