How Disney-Fox Merger Will Affect Consumers
STEVE INSKEEP, HOST:
American moviegoers paid an estimated $220 million to see "The Last Jedi" over the weekend.
(SOUNDBITE OF FILM, "STAR WARS: THE LAST JEDI")
OSCAR ISAAC: (As Poe Dameron) We are the spark that will light the fire that'll burn the First Order down.
INSKEEP: Oddly, we say something like that just before the show begins every morning here at MORNING EDITION. But that's not important right now. This is the second-biggest weekend for a movie ever. No. 1 was the series' predecessor, "The Force Awakens" - a big success for Disney, which also, last week, announced a deal to buy most of Fox Studios, which we will discuss with Hadas Gold, media reporter for CNN who's tracking Disney's story.
HADAS GOLD: Good morning.
INSKEEP: Thanks for coming by. How are we consumers going to feel this merger, if at all?
GOLD: We will feel it based off the way that we consume Disney and now Fox content because Disney and Fox - Disney is now looking towards the future. In doing this deal, they are really looking towards streaming. They now have a majority ownership stake in Hulu, and they are planning to launch two of their own streaming services, one focused on sports, one focused more on children and entertainment. And with this deal, they will own so much of the children entertainment and adult entertainment that we all enjoy.
And now they will have three different avenues with which to distribute it, which means that if you want to watch something that is owned by Disney - which now includes "Star Wars" and "X-Men" and "Avengers" and all of this - you won't be able to necessarily see it on Netflix. You will have to go and buy their own streaming service.
INSKEEP: They are becoming, I guess you'd call it, vertically integrated. They're going to own their own distribution system all the way through. And they can have exclusive products that make you buy their distribution system.
GOLD: That is the way that we are heading with a lot of these things.
INSKEEP: Fox News was said to be losing out - not big enough. It's a time when media companies feel they have to have an immense scale. I guess Disney's going to have that scale.
GOLD: Well, 21st Century Fox - they seemed to have recognized that they could not compete with the technology companies like Amazon or Facebook or Google, who are clearly getting into this content competition. And they are starting to possibly bid on things like sports. And Rupert Murdoch said they wanted to go back to their roots and now was a good time to sell.
INSKEEP: I'm curious because there was a time - and there still is a time for many - when people were massively frustrated by their cable TV companies because it's a monopoly. In many cases, it's your only choice. And that's what made a space for services like Hulu. As companies begin to consolidate, are we going to have fewer and fewer choices again?
GOLD: That is what some analysts say - that while Disney might claim that this is best for consumer, that this is actually consolidation leads to less competition, which leads to higher prices and less choice for people because it seems as though we're heading into the direction where instead of having a cable box that you have to pay for a big package for it, now we're just getting it all on our different apps on our Apple TVs. And we're going to end up kind of picking and choosing our own channels.
But still, if you're going to want to watch that one Disney show or that one, now what used to be 21st Century Fox show, you're going to have to buy the Disney streaming service or buy a Hulu application.
INSKEEP: Is it unusual that this corporate merger has a kind of endorsement from the White House already?
GOLD: Yes. It is very unusual. Obviously, there is history here between the president and Rupert Murdoch, who is the owner of 21st Century Fox - whose family owns it. And they talk all the time. And we saw a much different reaction to this deal than, for example, the AT&T-Time Warner deal. And for a president who spent some time on the campaign talking about how he wanted to break up these big media consolidation businesses and how he didn't think they were good for consumers, he's taking a different approach to this deal.
INSKEEP: Just full disclosure here, you work for CNN.
GOLD: I do.
INSKEEP: CNN is owned by Time Warner, part of that giant AT&T-Time Warner...
GOLD: Yes, they are.
INSKEEP: And the president had a particular opinion there. But in the case of the Disney-Fox merger, Sarah Huckabee Sanders, the White House press secretary, said "this could be a great thing for jobs." That's the quote. Could this be a great thing for jobs?
GOLD: Not for the 5,000 to 10,000 people who might be laid off as a result of the consolidating of these two companies because, if think about it, you don't need two distributors in Italy when now you're all in one company.
INSKEEP: So if it were to create economic activity, what it creates, I guess, is profits for stockholders, if it works at all.
GOLD: Exactly. But for the 5,000 to 10,000 people who are working at these studios or for the executives who might be now fighting for the few executive roles left, it's a different story.
INSKEEP: Hadas, thanks for coming by. I really appreciate it.
GOLD: Thank you.
INSKEEP: Hadas Gold of CNN this morning.
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