st Imashi Manamperi

Acquisition of 21 Century Fox by Walt Disney ANC ID: 5687

 Table of Content
1. Introduction
2. The Acquisition
3. Impact on the firm
4. Impact on the industry
5. VRIO Framework
6. Recommendations
7. Conclusion
8. References
 Introduction to Disney
• Disney is a diversified family entertainment and mass media conglomerate
headquartered in California.
• Walt Disney, together with Roy Disney formed this business in 1923 and it is
now served worldwide.
• It was formerly operated under the names Disney Brothers Cartoon Studio, The
Walt Disney Studio and Walt Disney Productions.
• Media Networks, Disney Parks, Experiences and Products, Studio
Entertainments, Direct-to-Consumer and International (DTCI)
Introduction – Fox Entertainment

• The American mass media company

was formed after a spin-off of News
Corporation
• It was found in June 2013 by Rupert
Murdoch.
• The company was divided into two
main segments which comprised of Fox
Entertainment group and Fox Network
group
• 21st Century Fox was the 4th largest
media conglomerate
 The Acquisition
• In December 2017, Disney confirmed that they would acquire 21st Century Fox
for $52.4 billion.
• The acquisition was completed on March 20th, 2019 for $71.3 billion.
• Disney purchased Fox's movie studio, its 39% stake in the European satellite
company Sky, their cable networks like FX and National Geographic, the regional
sports channels and a majority ownership in the streaming service Hulu.
• Fox’s network-TV channel and news and sports programming was not bought by
Disney and they now run under the name Fox Corporation
 Impact to the company
• The company now have access to a vast catalog of content that they can use in
their announced Disney+ streaming service.
• Disney now could make more content, some of which are far more adult-oriented
than what they are used to.
• International footprint of Disney will significantly increase
 Impact to the Industry
• Creating a sense of monopoly power in the film industry - almost 40% of the
movie market is now owned by Disney.
• The Disney-Fox acquisition would allow Disney to evolve into the fast-growing
streaming services business and compete better with Netflix and Amazon
• Fox Corp is no longer a major competitor in the industry
• The Marvel Cinematic Universe (MCU), currently the most successful movie
franchise in the world, will be infused with characters from both the X-Men and
Fantastic Four franchises.
• Over 3000 employees were laid off because of this integration.
 Place Your Picture Here

VRIO Framework
• This framework studies the
connection between a company’s
internal characteristics and the
performance.
 VRIO Framework

Valuable Rare Imitable Organization

Due to their Owning 40% of the Although their More products were
popularity, Disney movie industry is rare
products are added to their main
is considered a in the world and
imitable, it would be segments which are
valuable company. Disney was the first
hard to replicate media networks and
With the merger, to do it. Their
them as they are a studio
they can also exploit organizational
resources and vast large organization. entertainments.
the market more. Their brand name Disney also employs
human resources are
They also have a also not common in also plays a major over 180,000
value of $238.1b the world. role in their employees
(Forbes) uniqueness.
Recommendations
Disney could have also purchased the Fox Sports
channel along with the purchases.

Disney should not pull out the 20th Century

movies from being streamed at local theatres.

Provide a proper compensation and

recommendation letters for the employees they will
be laying off in the future

Not to remove Blue Sky Studios

 Conclusion
Disney has been acquiring many studios in the previous
decades. The more properties Disney owns, the harder it will
be to keep the originality that makes film such a special
medium. It is important for competitors to exist in the market,
or else product quality will go down. If this trend of acquiring
studios continue, the viewers won’t be as excited as they
should be due to the loss of originality.
Thank You
 References
• https://www.thewaltdisneycompany.com/about/#our-businesses
• http://web.b.ebscohost.com.librarydb.northwood.edu:2048/ehost/pdfviewer/pdfviewer?vid=1&sid=62aac597-534b-4ebb-b58d-531dc2c83f0d%40pdc-v-sessmgr03
• https://www.business-to-you.com/vrio-from-firm-resources-to-competitive-advantage/
• http://web.b.ebscohost.com.librarydb.northwood.edu:2048/ehost/detail/detail?vid=1&sid=dddddf17-5c94-408c-a3ec-070445d50677%40sessionmgr102&bdata=JnNpdGU9
ZWhvc3QtbGl2ZSZzY29wZT1zaXRl#AN=126840444&db=bsu
• http://web.b.ebscohost.com.librarydb.northwood.edu:2048/ehost/pdfviewer/pdfviewer?vid=1&sid=603674b1-d71f-47da-ada6-a0439bbd5201%40sessionmgr101
• http://web.b.ebscohost.com.librarydb.northwood.edu:2048/ehost/detail/detail?vid=1&sid=ecaea4ae-f953-4e53-9dc8-26b4f288c824%40sessionmgr102&bdata=JnNpdGU9Z
Whvc3QtbGl2ZSZzY29wZT1zaXRl#AN=6XN201712181008&db=n5h
• https://www.forbes.com/sites/danafeldman/2019/03/28/the-disney-fox-merger-whats-the-trickle-down-effect-for-consumers/#2ff5f0311efd
• https://www.latimes.com/business/hollywood/la-et-mn-disney-fox-merger-how-will-change-hollywood-20190308-story.html
• https://www.cnet.com/news/disney-acquires-21st-century-fox-good-or-bad-for-consumers/
• https://www.theatlantic.com/entertainment/archive/2019/03/disney-fox-merger-and-future-hollywood/585481/
• https://www.forbes.com/companies/walt-disney/#58f9246e5730