There’s lots we don’t know about the Disney-Fox non-deal that popped up yesterday:
How serious did the non-deal talks get? Is the non-deal really dead, or just pining for the fjords? Does the non-deal really make sense for Fox? What about for Disney?
But here’s one thing we do know: Rupert Murdoch and his sons, James and Lachlan, are willing to sell at least a very big part of their media empire.
If they hadn’t been thinking about selling, you would most certainly have heard that from them and their proxies, and we haven’t heard a peep. And if they were willing to sell at least some of the company to Disney, then they are willing to sell at least some of the company — and possibly more of the company* — to Verizon or SoftBank or John Malone or someone in Silicon Valley.
Another thing we know: Time Warner CEO Jeff Bewkes is selling all of his media empire, provided the Trump Justice Department lets him. Another thing we know: Scripps CEO Ken Lowe already sold his media empire for $12 billion this summer.
Scripps, Time Warner and the 21st Century Fox not-a-deal-yet are all very different transactions. But they’re also the same: Managers of giant media properties have looked around and decided that it’s time to sell. Tl;dr: Blame the internet.
It does seem worth asking why someone would want to be on the other side of the trade: If Jeff Bewkes and Rupert Murdoch want to get out, why do you want to get in?
Again, with the three transactions we’re talking about, the reasons vary to some degree: Discovery thinks its odds improve if it has more cable channels to bundle together, and AT&T insists that adding content will somehow improve its distribution business.
Disney, depending on who’s making the argument, thinks Fox’s library of TV shows and movies will help it launch a digital video service in 2019; or it likes Fox’s strength outside of the U.S. market, or it wants the X-Men to join the cast of its Marvel movies.
You can believe the logic in all of those deals if you want. But you have to weigh the fact that some of the world’s most successful media companies have concluded that they can’t do any better than they’re already doing.
So the people who think that they can do better must be very confident. How confident are you that they’re right?
* The not-a-deal that Disney and Fox discussed would have left Fox with assets like its sports and news networks, along with its broadcast TV operations. But Disney couldn’t have bought most of those assets, because of antitrust rules; what happens if a buyer who doesn’t already own, say, its own broadcast TV operations or its own sports channel shows up and wants to buy the whole thing?
This article originally appeared on Recode.net.