This past week, reports that Walt Disney Co. (NYSE:DIS) has entered into an agreement to purchase key assets from Twenty First Century Fox Inc. (NYSE:FOX) has been on the radar for many investors looking to analyze the deal for its long-term potential in providing Disney with an even larger moat as the media and entertainment company looks to build dominance in a sector which is under increasing scrutiny as consumers continue to "cut the cord" and embrace non-traditional streaming services provided by rivals such as Netflix, Inc. (NASDAQ:NFLX) and others.
To combat the threat Disney’s competition have provided in recent years, Disney’s management team has unveiled a plan to launch its own streaming service as soon as 2019, a move which has been met with cautious optimism at best, and skepticism at worst.
While Disney remains undoubtedly one of the best content producers in the media and entertainment sector, concerns about the ability of the company to switch gears into becoming a world class distribution platform are warranted.
That said, this recent partnership provides Disney with even more ammunition in its bid to capture as much “content market share” as possible, amid a market filled with original content being pumped into consumers’ living rooms on a daily basis. The $52-billion U.S. deal is one of the largest ever in this space, and while concerns remain as to the ability of the merger to go through, I believe such concerns to be near-sighted given the recent approval of other large transactions of late, including AT&T’s bid to acquire Time Warner.
Invest wisely, my friends.
