Talk all you want about 500 channels and narrowcasting to niches of viewers, Monday’s announcement that Walt Disney Co. would buy Capital Cities/ABC Inc. was a $19 billion vote of confidence in the mass market.
This is a marriage of the mainstream, a merger of Main Street and middle America. In a G-rated wedding, this is Snow White saying “I do” to Peter Jennings.
It was also a marriage of parcel and deliveryman. Disney is a moviemaking machine; ABC has entree into almost all of the 93 million TV-equipped American homes.
And in both respects, it is a marriage that typifies the rationale behind a spate of mergers and acquisitions in the entertainment industry.
Virtually all the big deals involve mass media as the target or the combination of product and distribution as the goal. ABC rival NBC was bought by General Electric in one such acquisition.
In the case of Disney and ABC, the alliance pairs a popular company known for movies and theme parks with the country’s highest rated TV network.
“You couldn’t be more mainstream than Disney or ABC,” said Henry Jenkins, director of film and media studies at the Massachusetts Institute of Technology. “They’re experts in mainstream.”
If confidence in a mass market in one piece of the rationale, fear of the future is another.
Everyone from banks to computer companies seem to be caught up in a merger frenzy, and the entertainment and information industry has generated more mergers than most.
With technology changing so rapidly, companies are afraid they’ll be left behind.
Howard Suber, a professor emeritus of film and television at UCLA, said in this environment an entertainment company either “swallows a smaller fish or it gets swallowed.”