Disney In Talks to Buy Most of 21st Century Fox

The CNBC report said the two sides were not talking now, but had held talks in the last few weeks, reflecting a view among Fox managers that the firm could not gain the size needed to compete with Amazon, Netflix and other major media players. With the shift to digital media, many believe that a corporation like Disney, rather than Fox, has the scale to compete in this new landscape.

Cable subscriptions, an area where both Fox and Disney have made fortunes, are slipping as more people "cut the cord" and rely on the internet to deliver their entertainment.

The report regarding the deal indicates that Disney is avoiding the Fox Sports and Fox News assets, as well as the Fox broadcast network, in order to stay on the right side of antitrust laws. However, with Universal holding the Orlando-area rights to Disney's most widely-known Marvel characters, a Fox deal would mean another of Universal Orlando's top themed area would be licensed from its biggest entertainment industry rival. In animation, Fox also has the Ice Age franchise. And the general logic of "you need scale to succeed in entertainment" makes sense, as that's also been cited as a factor in the pendingAT&T-Time Warner deal. That £11.7bn ($15.41bn) deal has run afoul of regulators' concerns about media plurality in the United Kingdom and the Murdochs' commitment to broadcasting standards. However with this sale, Disney can merge the MCU with the aformentioned characters.

The deal would give Disney control of another movie studio and significant TV production assets, and would give it more exposure to worldwide markets. But 21st Century Fox wouldn't sell all of its company. So it would definitely be interesting to see how a more-focused-on sports Fox would do, and how investors would react. James Cameron is now at the helm of filming four back-to-back Avatar sequels to the most successful movie of all-time, and already worked closely with Disney on the new attraction Pandora - The World of Avatar at Orlando's Disney World.

The Walt Disney Company has reportedly been in discussions with 21st Century Fox about buying a significant portion of Fox's film and television business.

Shares of Twenty-First Century Fox jumped by about 10% to as high as $27.49 after CNBC's report, while Walt Disney shares surged by almost 3% to as high as $101.12.

  • Kyle Peterson