FOX Interested in Making Acquisitions, Could It Look to Acquire Hulu or AMC Streamers?

FOX released its earnings report for its the second quarter of its 2023 fiscal year on Tuesday, and the report featured an interesting tidbit. At a time when many media companies are looking to trim their sails and take stock, FOX will reportedly be looking to spend some dough on major acquisitions.

“We’ll be looking at [mergers and acquisitions] and other opportunities to use to deploy our capital against,” said FOX corporation CEO Lachlan Murdoch. “We don’t have anything on the table today, but we are, I think, in a strong position to capture opportunities when they present themselves.”

The company thinks such opportunities are a good way to create more scale, an industry term referring to increasing revenue at a faster rate than costs. The company has cash to burn, as its proposed merger with News Corp. — another Murdoch-family-owned media company — will not be moving forward.

If FOX is serious about making a big splash in terms of acquisitions, there are a couple of options available in the streaming marketplace that it should look into. The first of these options is Hulu. FOX is already well-acquainted with this streamer, having owned 33% of it before selling most of its entertainment assets to Disney in 2019.

That was not the end of FOX’s relationship with Hulu, however. FOX primetime shows are sent to Hulu for streaming the day after their initial broadcasts, and a recent deal between the two companies ensures that arrangement will continue for years to come. Disney has been burdened with mounting losses from its streaming segment in the past year, and some industry analysts think the company might be better off selling Hulu for the sake of its balance sheet. If FOX truly is looking to add entertainment assets, this would be one that would make sense.

In addition to having already had an ownership piece of the platform, Hulu would give FOX a major player in the subscription video-on-demand (SVOD) corner of the industry. With 47.2 million subscribers as of November 2022, Hulu is a major player in the market, and is the only service to provide next-day streaming of shows that air on multiple broadcast networks. Assuming that FOX would be able to work out a deal to keep shows from Disney-owned networks — especially those that would not be appropriate on the family-friendly disney+ — on the service for the foreseeable future, it would give the company a major place in streaming that it doesn’t currently have.

It would also allow FOX to funnel series and films from the service’s library to its ad-supported streamer Tubi. Since both Hulu and Tubi have advertising components, this could be a perfect marriage for FOX as it continues to build its business on traditional broadcast.

Another avenue that FOX could pursue if it wants to pick up new streaming content is an acquisition of assets from AMC. That company began canceling shows from its premium linear networks and streaming services early in the year, including some that had already been filmed. AMC is seeking $400 million in write-downs to help offset losses from its linear TV segment, and the company cycled through three CEOs in 15 months between August 2021 and November 2022.

Snagging AMC’s content library would be a massive get for FOX, with shows like “The Walking Dead,” “Breaking Bad” and “Better Call Saul” offering big fanbases. These shows would undoubtedly bring an influx of new and sustained users to Tubi, or the company could decide it would merge AMC’s family of streaming services (AMC+,Acorn TV, ALLBLK, Shudder, and Sundance Now) into one platform and offer AMC content there; if FOX decided to acquire Hulu and AMC Networks, that would present a formidable library of content.

It’s entirely possible that FOX will pursue neither of these opportunities, and focus its merger and acquisition attention outside of the streaming world, but the company definitely has its eyes and ears open. Don’t be surprised if news about a major acquisition by FOX rattles the entertainment industry in the coming months.