Actionable news
0
All posts from Actionable news
Actionable news in DISCA: Discovery Communications, Inc.,

Discovery Buying Scripps Networks Needs to Happen for Both Companies

As the universe for pay-TV gets smaller, network owners need to get bigger.

On that note, both Discovery Communications Inc. (DISCA) and Viacom Inc. (VIAB) have begun conversations with Scripps Networks Interactive Inc. (SNI) , according to reports from The Wall Street Journal and Reuters. In both cases, talks are in early stages and a deal may not be sealed, the publications said, citing people familiar with the situation.

Scripps and Viacom declined to comment on the reports, while Discovery did not immediately return a request for comment.

Either transaction would make sense, for one overriding reason: TV network owners that don't also own a broadcast station or sports need size to sustain their positions on pay-TV platforms.

Ironically, as pay-TV providers such as AT&T Inc. (T) , Charter Communications Inc. (CHTR) and Dish Network Corp. (DISH) lose subscribers at faster and faster rates, they have more leverage when negotiating fees with TV network owners. While the traditional pay-TV bundle contains more than 80 channels, most of the fees, and ratings, goes to the owners of the four largest broadcast network and a handful of sports networks, principally ESPN. In other words, about 10 networks.

Meanwhile, younger viewers are spending...


More