Admiration, uncertainty, and downright fear rippled through entertainment circles far beyond American shores in response to the historic hookup between two already major global players, Disney and 21st Century Fox.
The marriage will create a colossus whose film, television and theme park assets bestride the globe and set up potentially powerful synergies in both production and distribution.
“Today more than any other day, we all wish we were Bob Iger,” said Joel Thibout of Paris-based financing and co-production company Backup (“Submergence,” “Brimstone”). “Right when ‘Star Wars VIII: The Last Jedi’ comes out, it’s as if he was thinking, ‘Ah, I’m missing X-Men!’”
“This is really bad news for every other studio,” grumbled one Asia-based Hollywood executive. “Competing against Disney is already tough enough. But Disney plus Fox is going to be really tough.”
Talk of the deal had dominated conversations at this week’s CineAsia convention in Hong Kong, where Kurt Rieder, Fox’s executive VP for theatrical distribution in Asia, opened his company’s presentation session by joking: “Welcome to the presentation by 20th Century Fox – or, as Bob Iger says, ‘All I want for Christmas.’”
Yu Dong, chairman and CEO of China’s Bona Film Group, said Thursday’s big announcement inaugurated a “watch and see situation” in the near term for his company, which has a slate financing deal with Fox. “When things become clearer, we will reassess if we still want to be a Fox investor – or even if the possibility is still there,” he said.
Many in the global industry see the logic of the Disney-Fox deal, which puts Disney in a stronger position internationally to weather the growing challenge of digital players such as Netflix, Amazon and Apple. The Mouse has already announced its intention to start a streaming service to compete with the likes of Netflix, and after the hookup with Fox it would have offerings that appealed to adults in addition to Disney’s world-beating kid-oriented fare.
“Increasingly Disney has been taking back control in the U.S. and looking forward to launching their own platform,” said Guy Bisson, research director at London-based Ampere Analysis. “In a way, they have the potential to launch a supercharged Netflix-type platform that can go global very quickly, and they have full control from content to distribution to the end viewer.”
Bisson said Disney was likely to start denying its content to competitors such as Netflix. Now that library will include Fox films and shows as well as Disney’s. “Over what timescale is the question,” Bisson said. “Disney is starting to do it with Netflix in the U.S. from next year, and we will start to see that [strategy] trickle through as they progress with plans to launch their own platform.”
The Disney-Fox deal is in line with the consolidation taking place throughout the media sphere, not just in the U.S. but in other parts of the world. Whether that’s a good or bad thing, however, remains to be seen.
“There is an unstoppable process towards concentration.…This is happening because the market is becoming completely global, so you have to have global scale,” said Riccardo Tozzi, president of Italy’s top film and TV production company Cattleya, which produced TV series “Gomorrah” for Sky and “Suburra” for Netflix.
“Since these players say they are driven to merge because they need to generate huge quantities of content, it looks like this could become a big party for those, like me, who are in the production sector,” Tozzi said. “But it’s such a gigantic operation that it could create disruption – even just temporary – that could be disastrous.”
Added one veteran Spanish film and TV producer: “For an independent producer, it closes one door to go for co-financing and distribution of your project.”
London-based producer Salon Films (“Churchill”) also lamented that it would mean one fewer buyer out there. “We might not have sold a prestige arthouse film to Disney, but Fox was always an option,” said Salon co-founder Nick Taussig. “How will they acquire now? Might they become even more Top 25? I suspect so.”
Emilie Georges, founder and managing director of Memento Films International and co-producer on “Call Me by Your Name,” said it was incumbent upon independent companies to carve out a space on a landscape increasingly filled with media giants.
“Our role is not just about selling movies,” Georges said. “It’s about getting closer to directors, helping them manage their careers overseas, giving them sufficient creative freedom to develop their projects and giving them an international perspective which big conglomerates may not have.”
For Carlo Degli Esposti, president of Italian production company Palomar (“The Name of the Rose”), a combined Disney-Fox would provide a welcome counterweight to Netflix. “However, as an independent producer, I’m not pleased that this whole race towards global scale means producers are getting increasingly cut out of the profit-sharing business model,” he said.
“An independent producer has to be able to rejoice, and also suffer, depending on the results of his product. What players like Netflix do is minimize your risk, but also cut you out of the exploitation [rights],” he said. “The risk going forward is that Disney-Fox will adopt that same business model towards producers.”
Frank Spotnitz, the former showrunner for “The X-Files” who is now based in Britain, welcomed Thursday’s news as a step forward for the old guard. “The Disney-Fox merger is an important and probably essential effort by traditional studios to compete in the digital era,” he said, adding: “It’s certainly better than seeing the traditional Hollywood players continue to decline.”
(Reporting by Leo Barraclough, Stewart Clarke, Patrick Frater, John Hopewell, Elsa Keslassy and Nick Vivarelli)