A Fox & Disney Merger Could Mean Bad Things For Netflix

CNBC reported on Monday that The Walt Disney Company was in talks to purchase 21st Century Fox, a potential deal that later reportedly “cooled” although talks have not yet been abandoned.

The sale would see Disney acquiring 21st Century Fox’s movie studio, 20th Century Fox, and ancillary media including some TV assets — not including Fox’s news and sports offerings nor its broadcast channel, which would stay with Fox.

Disney-owned Marvel Studios would then not only gain the live-action screen rights to Fox’s X-Men and Fantastic Four franchises, Disney would also come to own content like Futurama and The Simpsons.

Disney revealed in August it would be launching its own direct-to-consumer streaming service in 2019, at which time Disney will pull its content from Netflix. The premiere streaming service currently offers Disney titles like Captain America: Civil War, Rogue One, Moana and the live-action Beauty and the Beast.

Acquiring Fox’s entertainment assets would help fill out not only Disney’s offerings on their eventual streaming service in 2019, it would give Disney new intellectual properties to develop, such as heavyweight franchises like James Cameron’s Avatar and Planet of the Apes. The sale could include Fox’s stake in internet-based Hulu, of which Fox owns 30% — the same amount currently owned by Disney.

One big draw would be Futurama, which headed to Hulu last month after original episodes of the futuristic sci-fi comedy were yanked from Netflix.

Because of its exclusive content offerings, expect Disney’s streaming service to be highly competitive: Disney is already confirmed to be bringing new live-action Star Wars and Marvel shows to their streaming service, which will also see the debut of new television shows based on the popular and lucrative Monsters, Inc. and High School Musical franchises.

Disney CEO Bob Iger acknowledged the company’s streaming service will start with “substantially less volume” than Netflix, resulting in a monthly subscription price “substantially below” that of Netflix’s — another way Disney could hurt the competitor.