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Finally, The Clarity We All Needed In The Connected TV Space

Over the past 24 hours everything became clear in the Connected TV space. In fact, everything became crystal clear. First, The Walt Disney Company extended Bob Iger's contract by two years, through the end of 2026. Then, Bob Iger announced on CNBC that Disney's ABC television business may not be "core" to the organization. While the business press concluded that the Disney board realized that Iger would need more time to fix the company's problems, I concluded that The Walt Disney Company will be sold to Apple sometime before December 2026.

The moves suggest to me that Apple wants Disney, but it does not want the ABC television business. The moves also suggest that Apple wants to buy and integrate Disney into its operations while Iger is still running the business, and calling the shots. Let's not forget, Apple and Iger go back a long way. Iger was the Disney chief who bought Pixar from Steve Jobs and who, then, had a seat on the Apple Board for many years. [He only left the Apple Board when it became obvious to the world that Apple TV and Disney Plus would compete head to head in the CTV space.]

There are so many other meaningful connections between Apple and Iger. Here are just a few: Iger and Berkshire Hathaway CEO (and Apple's largest investor) Warren Buffett go back some four decades. Warren Buffett was instrumental in the sale of ABC to Capital Cities in the 1980s. Iger goes back just as far with Berkshire Hathaway Board Members Thomas Murphy Jr. and Stephen Burke, the sons of former Cap Cities/ABC toppers Tom Murphy and Dan Burke.

I have long wondered how Hulu ownership would factor into an Apple takeover of Disney. I wondered whether Hulu would be disintermediated from Disney -- or sold to Comcast or some other company -- to help abate any regulatory concerns. But it now seems, with the ABC television business being shopped, that Hulu will likely have a place within a combined Apple/Disney ecosystem. It suggests to me, anyway, that the parties are going to fight regulators for Hulu -- in much the same way Microsoft fought regulators for Activision.

In case there is still any doubt as to how things are going to play out between Disney and Comcast where Hulu is concerned, let me eliminate any doubt you may have. Last Friday, Comcast announced it was raising prices, for the first time ever, on its Peacock streaming service on August 17th. Pricing on both the ad-free and ad-supported offerings of Peacock are going up, signaling that Comcast is beginning to lay the foundation for the Connected TV battle.

So... questions we should all be asking at this time... What will happen to ABC's television business? Well, it will probably go the Private Equity route. Will Disney selling ABC affect the other networks? It will probably affect CBS, but not NBC. Paramount Global, owner of the CBS television business, may follow Disney's lead and sell its television operation. If it did sell its broadcast and cable offerings, it would set the stage for a battle over the Paramount studio assets, which many streaming companies would love to acquire. Amazon would probably be among the first to inquire about Paramount Pictures and its extensive library of films.

That leaves us with Comcast. Comcast will never part company with NBC. Comcast could, in fact, consider acquiring some of the ABC and CBS television assets. While buying either of the television networks, outright, would be challenging for Comcast, buying some of the more exciting cable networks might make a lot of sense for the company, given Comcast's foot print and history in the cable business. Comcast might also take a good hard look at buying Roku. With Roku devices in close to 50% of all streaming households, Roku would complement Comcast's telecommunications and cable business operations beautifully. It would also be a great hedge against a combined Apple/Disney and coupled Amazon/Paramount.

I have long maintained, the Connected TV business would get very interesting once Hulu ownership was settled. You'd better buckle up!

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