Diane Mermigas writes:
... The fact that media deals are being proposed on the basis of new expectations in an evolving digital broadband marketplace, using more traditional, older metrics, could cause some problems in the interim. ...
... To be sure, price and terms always will be at the heart of all mergers and acquisitions. But determining price and terms isn't what it used to be in a media world in which the business of entertaining, informing and communicating is being redefined. Media deals today have the potential to set new operating and investment precedent as billions of dollars in shifting valuations, revenue and profit are on the table in a high-stakes game involving founding old-media executives, high-tech industry newcomers and an intriguing array of investors. ¶ This certainly is true of the proposed $5 billion XM and Sirius Satellite Radio merger of so-called equals, which is challenging government regulators, shareholders and the media marketplace with the notion that changing competition, technology and economics justify the creation of a single, dominant media category provider. ¶ Supporters of the deal argue that hardly seems a threat when one considers the alternative ways for securing free-flowing music of choice, including streaming music on the Internet and music downloads to numerous devices. ...
Link: Mermigas on Media in Hollywood Reporter.
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