Media Mergers That Changed The Television Landscape

Media mergers of the past 12 years has changed the media world in ways that are fathomable. Companies are merging with other companies and companies are acquiring large television networks. Television networks like ABC was acquired by Walt Disney Company, CBS being bought and sold  a few times over the past 20 years  and the most recent acquisition by Comcast buying NBC Universal from Viacom. All of these mergers and acquisitions have changed the television and media landscape for the better. Television today isn’t what it was 15 years ago or even 10 years ago. All of these acquisitions have made television networks work harder to produce better shows that produce the most viewers each night. We don’t see television shows last as long as they did 20 years ago when shows like E.R. and 7th Heaven that were produced for 10+ years. These acquisitions by the likes of Walt Disney and Comcast have made rating more important loyalty. We also rarely see a network producing local shows like they did 30 years ago. As David Einstein said in SF Gate “The mergers between companies are a trend toward consolidation in the entertainment industry as companies vie for the high ground the in the new world of global communication. It’s basically the biggest reason that companies decide to merger or acquire another company, lower overhead cost and high revenue.

One of the first major acquisition that started the wave of media mergers and acquisitions was in 1995 when Walt Disney Company acquired Capital Cities/ABC Inc. for $19 billion. At that time this was the second largest U.S. merger in history according to SF Gate (Einstein). This deal created the largest entertainment company in the world combining the premier movie studio with at the time, the top rated television network. This deal started a wave of mergers and acquisitions with Westinghouse acquiring CBS a day later. Westinghouse deal to acquire CBS was a little different than Disney and ABC because Westinghouse was a industrial manufacturer. This was an example of a vertical merger. CBS would later separate from Westinghouse and be acquired by Viacom in 1999.

One of the most recent acquisition was Comcast acquiring General Electric’s share of NBC Universal for $13.8 billion in 2011. According to CNN Money “The merger combines Comcast’s cable networks, such as E!, Versus and the Golf Channel with NBCUniversal’s struggling NBC broadcast network, as well as popular cable networks USA, Bravo, MSNBC and The Weather Channel. NBCUniversal also owns the Universal Studios film and theme park businesses” (Comcast). This deal was two years in the making with many fearing that Comcast would raise prices on NBC programming to there competitors and also because they were already the largest cable provider and had no reason to make this deal. According to Todd Shields of Bloomberg “Comcast agreed not to interfere with subscribers’ Web traffic regardless of legal challenges to the open-Internet, or net-neutrality” (Shields). We really haven’t seen the effects of this deal, but sometime in the near future we will see how this deal will affect the television landscape.

All of these deals that occurred have showed that money and power is the most important factor when making these deals. When Walt Disney acquired ABC this was a major turning point in a shift of power of market control. There were deals before this like Time Inc. merging with Warner communications, Viacom acquiring Paramount Communications, and Time Warner acquiring Turner Broadcasting. All of these deals were important in their companies presence in today’s media market, but none was as changing as Disney and ABC. If you would like to learn more about how all of these deals happened and how each one changed the landscape you could read the article “A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC.”

References:

Einstein, David, and Jeff Pelline. “Disney’s Stunning Deal to Buy ABC/Biggest Media Firm in the World Would Emerge.” SF Gate/San Francisco Chronicle. Hearts Communication Inc., 1 Aug. 1995. Web. 2 Nov. 2012.

Fabrikant, Geraldine. “CBS Accepts Bid By Westinghouse; $5.4 Billion Deal.” New York Times. The New York Times Company, 2 Aug. 1995. Web. 2 Nov. 2012.

Johnson, Tom. “Viacom Tunes In To CBS.” CNN Money. Cable News Network/Time Warner, 7 Sept. 1999. Web. 2 Nov. 2012.

Shields, Tom, and Jeff Bliss. “Comcast Wins U.S. Approval To Buy NBC Universal From GE For $13.8 Billion.” Bloomberg. Bloomberg L.P., 18 Jan. 2011. Web. 2 Nov. 2012.

Image Reference:

Google Image, http://www.commondreams.org/files/images/big_media.jpg

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About Mergers Above You

Student at University of Colorado Denver, majoring in Business Finance. Always has a great time writing. Creating this blog for English class. Love learning anything about Business and Life.
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