Imagine If... | Comcast Succeeded In Their Pursuit of Disney

Originally Posted by Jeff Harris

Actual Events:
In 2004, Comcast, the nation's largest cable company, announced plans to purchase a controlling stake in The Walt Disney Company, one of the world's largest entertainment companies. The merger would have created a company that would rival Time Warner in all forms of media, from content creation to publications to cable outlets and distribution. The powers that be a Disney didn't want to merge with Comcast because they wouldn't be as powerful as they are now, so the purchase of called off. Comcast went on a spending spree throughout 2004 purchasing Paul Allen's TechTV at the beginning of the year, and, along with Sony and a few outside investors, MGM's film and television libraries and studio. As a result of the MGM purchase, Comcast has formed a close partnership with Sony to create new media outlets, including new VOD services and new networks, and currently pursuing NBC Universal

Wall Street and Madison Avenue were shocked and amazed when Comcast and Disney officially announced their merger plans in a multibillion dollar takeover deal from Comcast. The new company, called Disney Comcast Entertainment, is the considered the first true integrated media company for the 21st century. By combining one of the last "old Hollywood" studios with the largest cable operator in the country, Disney Comcast sets a model that will eventually influence the entire industry.

The company immediately changed a few outlets. Outdoor Life Channel became ESPN Outdoors, The Disney Channel became ad-supported, and Comcast Sports Networks dropped its alliances with Fox Sports Net and transformed into regional versions of ESPN. By the time the merger was completed in late 2004, the real changes began at Disney Comcast. For starters, the biggest changes happened to The Disney Channel. The network currently known as Disney Channel was relaunched as the Disney Family Channel (ABC Family Channel was relaunched as the ABC CableNet, running pretty much as it is with more ABC news and entertainment programs, including a repurposing deal with many ABC primetime series every week, as well as signing a limited airing agreement with CBN to air The 700 Club only twice a day and not nationally broadcasting CBN marathons, freeing up much of the lineup) while Disney Comcast launched a new premium cable network called The Disney Channel, a family-friendly outlet with uninterrupted movies, original shows and specials, and classic Disney programming, not unlike the original Disney Channel.

The new Disney Channel was just one of the two premium networks created by Disney Comcast. The other one was MovieNet, which utilized the movie library titles of Buena Vista, Disney, Touchstone, Hollywood, and Miramax (including pre-Weinstein Company Dimension) not unlike News Corp's Fox Movie Channel.

Comcast's G4 was one of the few casualties of the merger. It was revamped as Jetix, a new tween/teen oriented action brand created by Disney prior to the merger with many of its shows, including reformated interstitial segments like Cheats, Filter, and Cinematech, and regular shows like Judgement Day, Icons, and X-Play ending up alongside Jetix properties like Power Rangers, Beyblade, Digimon, Oban: Star Racers, Marvel cartoons, Gargoyles, and The Tick as well as other outside acquisitions from Nelvana, DiC, and others. Toon Disney pretty much stayed unchanged, though it began acquiring more outside programming from studios like Nelvana and DiC.

Because of the advent of video-on-demand, Comcast Disney has created numerous outlets using the technology. Disney Family Channel, The Disney Channel, MovieNet, and Jetix all have their own VOD networks and Disney On Demand PPV has the latest theatrical releases a month after they arrived on video as well as uncut library titles not availiable anywhere else as well as vault titles not commercially availiable such as individual episodes of The Muppet Show or Desperate Housewives.

In the end, Disney Comcast is one of the best companies availiable today . . .

Back to reality: . . . or at least it would have been, but Disney didn't want it to happen. Disney, which had been undergoing a period of uneasiness in the board of directors, which eventually lead to massive layoffs and resignations. Comcast, seeing this period of strain as an opportunity, found over $120 billion to buy the company. Comcast was serious ($120 billion isn't chicken feed, you know), but the board wanted more for the company, even though Wall Street estimates had the bid overpriced. So, Comcast reluctantly dropped its bid. Disney's ABC is one of the few highlights of the company over the last year, but Disney is still on shaky ground with lackluster box office receipts for most of their films and low video sales. They have slowly come back around in 2006 thanks to Narnia, Pirates of the Caribbean, and their recent purchase of PIXAR, which reignited the animation unit of the studio, and Marvel Entertainment, which gave them a stable of popular franchises and a house of ideas.

Comcast is positioning itself as a content provider thanks to key acquisitions and alliances, including one with Disney to create VOD services exclusively on the Comcast cable services, which is remarkably similar to what I wrote way back in 2005. And they're aiming to put their monopolistic hooks into NBC Universal. Not quite the monster that was Disney, and more or less a booby prize in 2010.

What's next?