What Disney Bought: A Billion-Dollar Breakdown of Assets

Now that the megadeal is done and the smoke has cleared, there’s a price tag that can be put on each asset moving from Fox to Disney. Analyst estimates vary; the numbers below are derived from RBC Capital Markets.

Disney is getting two groups of channels from Fox: FX Networks and National Geographic Channels. FX is the home of critically acclaimed, edgy series from “American Horror Story” to “Fargo”–exactly the kind of content Disney lacks. Nat Geo has just begun to broach that business with scripted fare like “Genius,” but it’s a classic brand that fits perfectly with Disney’s portfolio, and one that is already translating nicely to digital platforms like Snapchat.

That they may represent the priciest assets in the whole deal is less a reflection of their future worth and more a testament to how valuable linear channels have been over the past decade, given the billions of dollars in advertising and affiliate fees they’ve brought to Fox. But Murdoch’s willingness to give them up is proof positive that the pay-TV business is in a state of secular decline, one that will provide plenty of short-term value but limited in the long term. Digital channels like FXX and NatGeo Wild are probably going to be retired eventually.

With ho-hum franchises like “Kingsmen” and “X-Men,” Fox certainly can’t hold a candle to what Disney has accomplished as a movie studio, though there’s still value to be mined with the upcoming “Avatar” sequels and the expected commingling of their assorted superhero characters. The valuation here is probably more based on the greater successes Fox has enjoyed in TV from animation (“The Simpsons”) to comedy (“Modern Family”), where syndication has proved a veritable goldmine. TV production capabilities will be absolutely key to powering Disney’s intent to go head to head with Netflix in the streaming game come 2019.

At first blush, it might seem counterintuitive for Disney to pay so much for what is essentially a satellite-based operation, a business with dim future prospects. But there is so much more to Star than that: It not only provides more international exposure for Disney in a business where it’s under-represented, but India may be the biggest growth market on the globe. Best of all, Star has an OTT platform, HotStar, that already has over 50 million subscribers and rights to must-have sports content in the region like cricket. As Disney mounts a global OTT effort, this could become a very valuable piece of the puzzle.

With ESPN becoming something of an albatross around Disney’s neck these days, doubling down on sports might seem a strange move. But having 22 RSNs across the country that boast deals with some of the greatest franchises — like the home run-happy New York Yankees with Aaron Judge and Giancarlo Stanton — could help shore up the faltering economics underpinning ESPN. Incredible affiliate fees will be a great buffer for Disney in the short term while it mounts a risky multi-year effort around OTT that may not provide desired returns for quite some time.

The value here is mostly tied up in Sky, where Fox had been engaged in a torturous, possibly doomed effort to snap up the 61% portion of the satcaster it doesn’t own. Handing that over to Disney could help ease the regulatory path to getting a deal done; the combination of Sky and STAR will give Disney an incredible international footprint across two continents.

The rest of these investments are tied up in Endemol, a production hub that could also help TV production efforts, and Hulu, where Disney will take a controlling interest. Hulu could become a valuable contributor to Disney’s overall OTT efforts given the head start the joint venture has in this space.

Total Enterprise Value of What Disney Is Buying From Fox: $66.1 billion

Fox Debt Disney Will Assume: $13.7 billion

Sale Price $52.4 Billion

From Variety

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Disney Buying Most of 21st Century Fox for $52.4 Billion

Disney is buying a huge chunk of 21st Century Fox in a deal that promises to reshape the media industry and help the entertainment giant fend off digital rivals such as Netflix.

The $52.4 billion deal will combine two of the biggest players in Hollywood.

The sale represents a remarkable turn in the career of octogenarian mogul Rupert Murdoch, who is cashing out after building a major media empire. For its part, Disney is adding even more prime entertainment assets to an already swollen portfolio as it battles upstart streaming services that have undercut the traditional cable subscription model.

In addition to 21st Century Fox’s movie studio and regional sports networks, Disney is buying cable channels FX and National Geographic. Disney will also get Fox’s stakes in Hulu and European pay-TV provider Sky.

Prior to the deal closing, 21st Century Fox will separate the Fox broadcasting network, Fox News Channel, Fox Business Network, and some national sports networks into a new company that will be spun off to its shareholders. The remaining properties would ideally in the coming years merge with News Corp., from which they split in 2013, Murdoch said on Fox Business Thursday morning.

Disney, which counts ESPN among its crown jewels, has suffered as consumers switch off their TVs and spend more hours watching streaming services such as Netflix that are distributed directly to consumers.

The deal allows Disney to expand its content, especially for streaming services. In addition to a majority stake in Hulu that it will have once the deal closes, Disney is preparing to launch two separate streaming services, one for sports and another focusing on entertainment. And it is pulling its content from Netflix in preparation for the launch. Adding Fox’s television and movie studios and the content they own means adding to the stable of must-watch content it can offer directly to consumers — and that streaming competitors can not.

There are also important international assets involved. Fox is in the midst of a lengthy regulatory review in the United Kingdom to take over the rest of the satellite broadcaster Sky it does not already own. In the announcement, Disney and Fox said “21st Century Fox remains fully committed to completing the current Sky offer and anticipates that, subject to the necessary regulatory consents, the transaction will close by June 30, 2018.” Disney would then assume full ownership of Sky as long as Fox’s transaction is completed before Disney’s.

If the deal doesn’t close, then Disney will retain Fox’s current 39 percent stake of Sky “and we imagine they’ll make their own bid for the rest of it,” Murdoch said on Fox Business on Thursday.

The deal will needs to undergo regulatory review and will likely take at least a year to close. The Justice Department, which last month sued to block AT&T’s purchase of CNN parent company Time Warner, will consider to what extent the new company could dominate the market, using its increased leverage to force cable companies and distributors to pay higher rates to carry Disney and Fox content.

News of a possible deal first came to light in early November when CNBC reported that Disney had approached 21 Century Fox about a deal to acquire the movie and television assets. That led to other companies, like Comcast, to explore an acquisition as well. But on Monday Comcast said in statements to media outlets that it “never got the level of engagement needed to make a definitive offer” and was withdrawing from the discussions.

As the two companies work to complete the deal and Disney works to integrate its new assets, Bob Iger, who had been expected to retire, will remain as chairman and CEO of Disney through 2021.

Speaking on Fox Business Thursday morning, Murdoch said he made it a condition of the deal that Iger would stay on.

“The acquisition of this stellar collection of businesses from 21st Century Fox reflects the increasing consumer demand for a rich diversity of entertainment experiences that are more compelling, accessible and convenient than ever before,” Iger said in a statement. “We’re honored and grateful that Rupert Murdoch has entrusted us with the future of businesses he spent a lifetime building.”

There had been some reporting that Murdoch’s son James, currently CEO of 21st Century Fox, would move over to Disney in a high level role and as a possible successor to Iger. But in a conference call with investors on Thursday morning, Iger said there are no immediate plans for James Murdoch.

“James and I have had a lot of conversations about the future of these companies,” Iger said. “He will be integral to helping us integrate these companies over the next number of months and during that period of time we will continue to discuss whether there is a role for him here or not.”

In a statement of his own, Murdoch said, “I’m convinced that this combination, under Bob Iger’s leadership, will be one of the greatest companies in the world. I’m grateful and encouraged that Bob has agreed to stay on, and is committed to succeeding with a combined team that is second to none.”

From CNN Money

Bob Iger Could Stay at Disney Beyond 2019 if 21st Century Fox Deal Happens

Walt Disney has already delayed the departure of longtime chairman and CEO Bob Iger a few times. But if a much-hyped (and, currently, only rumored) acquisition of 21st Century Fox actually does happen, then Iger reportedly could extend his tenure beyond his currently planned July 2019 retirement date.

The Wall Street Journal reported on Wednesday that Disney’s board is likely to extend Iger’s contract once more if the company’s reported negotiations to buy a large chunk of Fox’s entertainment assets do, in fact, result in a deal. Rumors that Disney may be talking to Fox about acquiring most of the latter’s movie and cable TV assets, including its valuable regional sports networks, first popped up in early November. Now, reports peg the value of a potential deal at anywhere from $40 billion to $60 billion, based on anonymous sources, with the companies possibly set to reach a final agreement as soon as next week.

In March, Disney’s board officially extended Iger’s contract until July 2019, marking the third (at that time) postponement of his planned retirement from the company. The chief executive, who took the reins at Disney in 2005, had most recently been set to retire in the summer of 2018. The main reason for Iger sticking around has been Disney’s inability to name an heir apparent, though Fox’s James Murdoch is now being floated as a potential successor if the deal is finalized.

Disney is coming off a recent fourth quarter that fell short of Wall Street’s earnings expectations, marked by the continuing struggles of the company’s television unit. Meanwhile, the company is looking to mount a huge challenge on the streaming front, with plans to launch two standalone streaming services—one dedicated to live sports and another for movies and TV—over the next two years. So, it’s possible that Disney would prefer for Iger to stick around a bit longer to oversee the aftermath of a potential megadeal and the packaging of Fox’s vast entertainment assets with Disney’s for the two streaming services.

From Fortune

Why Olaf’s Frozen Adventure is Really Being Removed from Coco Screenings

Olaf’s Frozen Adventure, one of Disney’s less lauded short films, will soon be leaving theaters after screening in front of Pixar’s Coco, the animated film inspired by Mexico’s Day of the Dead. Yet while some have suggested it’s a direct response to poor audience reactions, EW has learned that isn’t the case.

Olaf’s Frozen Adventure was always promoted and scheduled as a limited run, EW has confirmed, with its theatrical play slated to conclude next week, as has recently been reported.

Mashable was the first to report that Olaf’s Frozen Adventure would end its theatrical run Dec. 8. The outlet reported that Disney had “directed theaters … to remove the deeply unpopular 22-minute Frozen short” from future screenings.

In addition, a user on Reddit, identifying as a movie theater worker, claimed to have received a note from Disney regarding the decision. “Please note that the run of Olaf’s Frozen Adventure playing before Coco will end after 12/7,” the alleged note stated. “Starting on Friday 12/8 no more Olaf shorts should be up on screen. With the extra 22 minutes of running time back, we would appreciate if you could get in an extra show if possible.”

In light of the information provided to EW, the alleged note appears to be more of a reminder and less of a notification of removal. “This was always promoted as a limited run so it’s not really a story — the end of our Olaf theatrical play is coming next week,” a Disneyrepresentative told EW. “All our ads and messaging called it as such.”

Featuring the return of Olaf (voiced by Josh Gad), the short — which is the first from Walt Disney Animation to be screened in front of a Pixar film — sees the snowman from Frozenon a search for holiday traditions for Anna (Kristen Bell) and Elsa (Idina Menzel). While most Pixar shorts run around 10 minutes, this Disney Animation work runs for more than 20 minutes.

Mashable called the pairing of Olaf’s Frozen Adventure with Coco, which received glowing reviews and recently won Best Animated Film from the New York Film Critics Circle, “culturally tone-deaf.” Other critics have echoed the sentiment.

“We are creatures of habit, and Olaf’s Frozen Adventure eventually feels like the grinning house guest who won’t leave, even though the party was supposed to clear out long ago,” reported The Washington Post. “As each successive song in the four-tune reel cues up, moviegoers’ reactions can be heard to switch from laughing irritation to growing mockery to outright anger.”

From MSN/Entertainment Weekly

Disney to Direct Theaters to Remove Frozen Featurette Next Week

Olaf’s Frozen Adventure has been put on ice.

Disney has directed theaters running Coco, Pixar’s latest, to remove the deeply unpopular 22-minute Frozen short that plays in front of each screening. The removal goes into effect on Dec. 8, sources familiar with the matter confirmed to Mashable.

The request from Disney also asks that theaters use the newly freed-up time to hold extra screenings of Coco each day.

Pixar movies generally open with a completely unrelated short film, usually running no more than 10 minutes. Olaf changed the game somewhat, between its length and its reliance on a Disney Animation Studios hit (Pixar’s shorts are generally homegrown).

The Frozen short has been especially problematic for a number of reasons. Length is the biggest issue, of course, since the actual movie doesn’t start until 40 minutes after the advertised time, between trailers, ads, and Olaf. That’s a lot of extra sitting around for an audience comprised primarily of kids expecting a story about music and family, set against the backdrop of Mexico’s Dia de los Muertos.

Some have also accused Disney of shameless self-promotion, for swapping in what is seen as an ad for Frozen 2 — which is out in Nov. 2019 — where there would usually be a Pixar creation. As Mashable’s Brittany Levine wrote last week, Olaf’s Frozen Adventure “felt like Disney was spitting in my popcorn for 21 minutes.”

From Mashable

Tokyo Disney Resort Set for Major Expansion

Oriental Land, which operates the Tokyo Disney Resort complex that includes the Disneyland and DisneySea theme parks, has revealed plans for a massive expansion. Completion is expected in 2023.

The company plans to invest nearly $2.7 billion to upgrade and expand facilities and attractions, while planning to double visitor numbers by 2020, the year of the upcoming Tokyo Olympics. With the planned expansion the 100-hectare complex is expected to grow 30%.

Oriental Land operates Tokyo Disney Resort under license from Disney. Since its start in 1983 with the opening of Tokyo Disneyland, the theme park, hotel and shopping complex in Chiba Prefecture, has grown to attract nearly 30 million visitors annually.

From Variety

The Saga Continues with OtterBox: Star Wars-Themed Cases

The Force is strong with this one. Defend iPhone 8 and iPhone 8 Plus from drops, dings and galactic threats with Star Wars-themed Symmetry Series cases.

From Star Wars: A New Hope to Star Wars: The Last Jedi, OtterBox has a protective case designed for every Star Warsfan. Cases are also compatible with iPhone 7 and iPhone 7 Plus.

Star Wars has awakened a new generation of enthusiasts and Symmetry Series cases featuring Star Wars designs provide the perfect companions for wherever your epic journey takes you,” said OtterBox CEO Jim Parke. “Now fans can express their inner Jedi while defending their devices from real-world pitfalls.”

Symmetry Series protects every fan’s device from the dark side of phone ownership with a slim and sleek form. The dual-density case slips easily in pockets while a raised beveled edge keeps the touchscreen tucked away from harm during drops. Star Wars afficiandos can show off their favorite icons and characters with the new designs on Symmetry Series cases.

Symmetry Series Star Wars Collection cases are now available at otterbox.com for iPhone 8 and iPhone 7, $44.95; and iPhone 8 Plus and iPhone 7 Plus, $54.95. For more information, visit otterbox.com. OtterBox is the “Official Protective Case” of Walt Disney World Resort and Disneyland Resort.

Disney Announces More Details for ABC Primetime Special ‘The Wonderful World of Disney Magical Holiday Celebration’

Merry holiday moments from Disney theme parks around the world and a star-studded cast of entertainers will launch a “25 Days of Christmas” countdown when “The Wonderful World of Disney: Magical Holiday Celebration” airs Thursday, November 30th, from 9:00–11:00 p.m. EST on The ABC Television Network.

The magical two-hour event will be hosted by Emmy® Award-winner Julianne Hough, multiplatinum recording artist and television personality Nick Lachey, and sports star, broadcast correspondent and commentator Jesse Palmer. The show will give viewers a front-row seat to a Disney Christmas party like no other – a family holiday tradition brimming with colorful lights, snow flurries, memorable music and more. From the Cinderella Castle stage at Magic Kingdom Park at Walt Disney World Resort in Florida, Hough and Lachey will perform a spectacular opening number named for the primetime special.

Tony Award-winning actress Idina Menzel will join fellow “Frozen” star Kristen Bell to perform together for the first time on primetime television. The pair, who voiced the characters of Elsa and Anna in the animated blockbuster, will perform in front of Sleeping Beauty Castle at Disneyland Park in California accompanied by a 30-voice choir. The two stars of stage and screen will sing “When We’re Together” from the brand-new Walt Disney Animation Studios featurette, “Olaf’s Frozen Adventure.”

The holiday special’s other unforgettable, wish-come-true moments will include an extraordinary castle lighting extravaganza from Disney theme parks around the world – traveling the globe from California and Florida to Paris, Shanghai and Hong Kong.

A Sneak Peek at New Star Wars– and Toy Story-Themed Lands

The force will be with all who tune in for a sneak peek at Disney’s new Star Wars-themed lands, Star Wars: Galaxy’s Edge, opening at both Disneyland Park in California and Disney’s Hollywood Studios at Walt Disney World Resort in Florida in 2019. The new lands promise adventure on a galactic scale when guests steer the Millennium Falcon on a customized secret mission in one attraction and engage in a climactic battle between the First Order and the Resistance in another.

From the edge of the galaxy “to infinity and beyond,” viewers will discover Andy’s world in the new Toy Story Land to open next year at Disney’s Hollywood Studios at Walt Disney World Resort in Florida. The new family-friendly Slinky Dog Dash roller coaster and the Alien Swirling Saucers attraction will join the original Toy Story Midway Mania! attraction to give Woody, Buzz and Andy’s entire toy collection a backyard play land scaled to render park guests seemingly toy-sized.

Musical performances in the primetime special will include:

  • Ciara will perform a joyful Christmas medley, including “Jingle Bells” and “Jingle Bell Rock” from a sparkling Cinderella Castle at Walt Disney World Resort.
  • Grammy Award-winning country artist Darius Rucker will sing “Winter Wonderland.”
  • Emmy-nominated actress and singer Lea Michele will be joined by special guest Joey McIntyre to sing the classic holiday duet, “Baby It’s Cold Outside.”
  • Multiplatinum-selling group Fifth Harmony will sing “Can You See,” from The Star soundtrack, plus “The Christmas Song.”
  • Fitz and the Tantrums will perform their platinum-certified hit, “HandClap,” and their original Christmas song, “Santa Stole My Lady.”
  • Multi-Grammy-nominated trio Hanson will light up the night singing “Finally It’s Christmas,” from their recently released Christmas album.
  • Boy band In Real Life will sing “I’ll Be Home for Christmas.”
  • Multiplatinum powerhouse Jason Derulo will perform “This Christmas.”

Viewers at Home Will Be Able to “Glow with the Show”

For the first time, viewers will be able to “Glow at Home” during select performances in the holiday special, thanks to the brand new “Made with Magic® 3.0: Connected Ear Hat” and the Shop Disney Parks app. Leveraging Bluetooth® technology, the Shop Disney Parks app enables viewers wearing the new 3.0 edition ear hats at home to sync with the ABC holiday special playing on the viewers’ TVs or other devices. Viewers will feel like they are part of the show.

The app also has a remote-control feature to adjust the ear colors and speed of the strobe – a brand-new feature for the Made with Magic® Ear Hats. If viewers at home don’t have the special edition ear hats, not to worry. The Shop Disney Parks app will allow them to enjoy a second screen experience as their mobile phone comes alive, mirroring the spectacle on-screen during select performances. The Made with Magic® 3.0: Connected Ear Hat and the interactive ear hat remote control feature on the Shop Disney Parks app will both be available November 17th.

From WDWMagic

Disney Shuts Down Marvel Heroes

Disney and Marvel are shutting down free-to-play action RPG Marvel Heroes.

In part with this decision, Disney has ended its relationship with Marvel Heroes publisher, Gazillion Entertainment, according to a statement IGN received from Marvel Entertainment.

“We regret to inform our Marvel Heroes fans that we have ended our relationship with Gazillion Entertainment, and that the Marvel Heroes games will be shut down. We would like to sincerely thank the players who joined the Marvel Heroes community, and will provide any further updates as they become available,” a representative for Marvel Entertainment confirmed.

As noted by Kotaku, some signs of trouble at Gazillion arose when the developer missed several weekly community updates.

Players have been able to enjoy the PC version for years, with Marvel Heroes: Omega launching on PlayStation 4 and Xbox One in June of this year. The game has featured heroes from every corner of the Marvel Universe, recently adding Black Bolt and Loki to consoles. It has also seen multiple tie-ins to the Marvel Cinematic Universe, including releases for films this year like Spider-Man: Homecoming.

Originally released in June of 2013, the free-to-play game initially received mixed reviews, but over time Gazillion has consistently improved the game, also adding many fan-favorite characters

From IGN

21st Century Fox Holding Talks to Sell Most of the Company to Disney According to Sources


21st Century Fox has been holding talks to sell most of the company to Walt Disney Co., leaving behind a media company tightly focused on news and sports, according to people familiar with the situation.

The talks have taken place over the last few weeks and there is no certainty they will lead to a deal. The two sides are not currently talking at this very moment, but given the on again, off again nature of the talks, they could be revisited.

For Fox, the willingness to engage in sale talks with Disney stems from a growing belief among its senior management that scale in media is of immediate importance and there is not a path to gain that scale in entertainment through acquisition. The company is said to believe that a more tightly focused group of properties around news and sports could compete more effectively in the current marketplace.

The media landscape has changed considerably in recent years with giants such as Facebook, Google (Alphabet), Amazon and Netflix changing the way people consume media and dominating the digital distribution of digital video content. Being able to compete in that changing landscape, many people believe, requires scale that a Disney has, but 21st Century Fox does not.

For Disney, the opportunity to take control of another movie studio and significant TV production assets as it readies a direct-to-consumer entertainment streaming offering is attractive as is Fox’s significant exposure to international markets, such as the U.K., Germany and Italy — both through its networks and 39 percent ownership of Sky. Disney recently announced it will pull all of its movies from the Netflix platform and will establish two direct-to-consumer offerings: one for sports and one including its key franchises such as “Star Wars” and Marvel.

Disney would not purchase all of Fox, according to people with knowledge of the talks.

From CNBC