Verizon Buys CBS and Viacom In 2018- Prediction #3
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There is no doubt that Netflix ($NFLX) is reshaping the media landscape in a way that is far more severe than many may have ever thought. As the company continues to drive subscriber growth, that has now eclipsed 100 million global users and spending $8 billion in original content creation, it is forcing the media giants to rethink the way they do business. It takes us to our third predictions for 2018: Verizon Takes The Plunge Into Content, Buying CBS and Viacom
Shifting Media Landscape
Netflix’s massive spend on content in 2017, has caused companies such as Disney ($DIS) to finally severe ties with the streaming media giant, forcing Disney to create its own direct to the consumer product. Also in an attempt to strengthen it’s content library, acquire assets from Fox for over $50 billion. This is likely just the start of a wave of consolidation in the media space.
Prediction #3 – Verizon Plunges Into Content Buying CBS and Viacom
Prediction 3- Could 2018 be the year Verizon ($VZ) follows AT&T ($T) lead? Perhaps. In an attempt to catch up to AT&T’s and its bid to buy Time Warner ($TWX). Verizon could throw its hat into the ring and go after CBS ($CBS) and Viacom ($VIA) in 2018. A move like this could bring CBS and Viacom back together, and put Verizon squarely in the middle of the direct to the consumer experience, riding on the backbone of its FiOS product and the rollout of its 5G wireless network. It seems crazy, for sure, and a wild prediction. It could come at a valuation equal to that of what Disney paid for Fox assets, at roughly $50 billion for both CBS and Viacom, giving a 40 percent premium to the two companies combined market caps of about $36 billion.
Anything Could Happen
There is no doubt that that media landscape is shifting very quickly, and when things move fast, anything could happen.
10 Predictions For 2018:
The purpose of the 10 predictions is for fun and to think about the year to come. It helps to organize thoughts and think about potential themes and trends that could develop. See our 10 predictions for 2017 and judge for yourself how we did.
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Michael Kramer and the clients of Mott Capital own shares of $VZ $NFLX $DIS
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