While we wait to see who the winner will be in the battle for Warner Bros., the question arises: What's next when it comes to media consolidation?
We are talking about the further decline of the
linear TV business. Should we be thinking about those midsized cable TV
network players -- AMC Networks, Hallmark (Crown Media), Starz, CuriosityStream, or others?
The biggest attractions will continue to be the creation and/or ownership of premium TV and
movie productions for the future. Distribution will be key.
But they need to have core, owned content that people want to see.
AMC Networks is a likely candidate, according to
analysts. It has a big library. Think “The Walking Dead" and “Breaking Bad”. It also owns (or co-owns) five established networks, including AMC IFC, SundanceTV, WE tv, and BBC
America (joint venture).
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A+E Networks is in a different situation, as a joint venture by Walt Disney/Hearst. It has a large library of non-sports, unscripted content, which has run on its
mid-size cable networks.
Who would be buying? Maybe not the big legacy TV/media companies. Think FAST (Free Ad-supported Streaming TV) services or other mid-size AVOD (advertising-based Video
on Demand) platforms. BritBox, MGM+, perhaps?
Then we have Lionsgate. It recently split from premium cable TV networks group Starz. Analysts believe Lionsgate activist investors will want a
big payday -- especially seeing what Warner Bros. stock owners will no doubt get as from either Netflix or Paramount Skydance.
Who would be buying? Reports suggest that Legendary
Entertainment, which is a production company, could be a player. It is similar to Skydance Media, a veteran producer of big movies and TV shows.
Some of Legendary’s movies include
franchises such as “Dune” and “Godzilla”. Other movies produced included: “The Man Steel”, “The Dark Knight”, and “300.” TV shows:
“Westworld” (HBO); “Lost in Space” (Netflix), and “Monarch: Legacy of Monsters” (Apple TV+).
A spin on this could be if Paramount Skydance fails to win
Warner Bros. Analysts believe they may pivot to Lionsgate as a "consolidation prize" to gain more content/library depth.
Broadly speaking, also consider interest from digital/tech companies
looking to make gains in acquiring traditional cable TV ad inventory, to expand possible reach, and top of the funnel engagement for micro-focused clients.
Other private investment firms might
target these cable TV network groups to “run-off” or wind down these businesses for short term financial gains.
Why then buy these networks -- in any event?
While many
consider they are still too valuable to shut down, at the same time they are too small to survive alone.
So this is an inflection point that results in lots of question marks, with
increasingly nervous senior executives and clients. Welcome to more drama.