June 25, 2014
Earlier this year, I suggested that Apple should buy Disney. A key analyst has now agreed. In Wednesday's Washington Post, North River Venture’s Francis McIlerney says Apple buying Disney is the best way to ensure its revenues continue growing. “The logic is so great this could happen tomorrow," he says. The reason? The shift of content to the cloud may force Disney to act.
McIlerney imagines the two combined as a “Netflix on steroids,” in which Apple would benefit from finding ways to monetize Disney’s content offerings, and Disney would have a safe and profitable place in the emerging, unbundled world of TV and video to peddle its wares. Having Disney under the Apple umbrella would also be an asset if Apple ever launches a television set, which has been suggested for years but may not become a reality.McIlerney calls an Apple-Disney deal “frighteningly obvious,” noting that Disney CEO Bob Iger already sits on Apple's board. Of course, this doesn't mean an acquisition is imminent. Apple currently holds $151 billion. Disney’s market cap is $143 billion, leaving Apple with very little wiggle room were they to make an offer. More importantly, the majority of that $151 billion is offshore and would be taxed if Apple had to bring it back to the U.S. There is also the question of whether regulators would approve such an acquisition. McIlerney explains why he thinks Apple should buy Disney in the following video: http://vimeo.com/95753487 There are a number of good reasons why Apple should purchase Disney, as I stated previously. In doing so, Cupertino would gain an immense film library, and own a stake in a number of television networks, including ABC and ESPN. The purchase would also give Cupertino a sizable stake in Hulu, which would be a great way to reenergize the Apple TV. On the negative side, such an acquisition would be very expensive. Plus, I wonder whether Apple would really want to own theme parks. See also: If You Believe This Survey, Apple's 'iWatch' Could Be A Disaster, and Apple’s Clever Plan To Convince Us To Pay More For The 'iPhone 6.' Image: StuffPoint