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Which Streaming Service Might WarnerMedia Discovery Acquire?

Ben Bowman

Although some media companies have whispered about an attempt to acquire the newly formed WarnerMedia Discovery, CEO David Zaslav said he’s in the mood to make an acquisition instead. But what’s available for sale? And could WarnerMedia Discovery acquire it?

Too Big to Buy

Unless Zaslav is willing to cripple his company with insane debt, many of the media streaming companies are far out of reach. Today, Discovery’s market cap is $15 billion, while AT&T’s market cap is $206 billion. It’s unclear what line of credit Zaslav will have to make an acquisition, and how much would come from each side.

Apple ($2.127T), Amazon, ($1.77T), Disney ($320B), Comcast ($268B), Netflix ($233B), have deep pockets and significant revenue, meaning they’re more likely to buy than to be bought. So you can scratch off Apple TV+, Amazon Prime Video, Disney+, Hulu, ESPN+, and Peacock.

Unlikely, but Possible

ViacomCBS — At a market cap just over $28 billion, the company is a big buy, but the price is more reasonable. The portfolio is pretty impressive, as well. A buyer would get CBS, streamers like Paramount+, Showtime, and Pluto TV, along with linear channels like BET, MTV, Comedy Central, Nickelodeon, VH1, CMT, and TV Land. A buyer would also get a ton of intellectual property that aired on those services. If any company wanted to own “Star Trek” and “SpongeBob,” this is their chance. Pluto TV is also a growing force, with 50 million monthly active users that advertisers would love to target.

Allen Media Broadcasting — The privately-owned company owns The Weather Channel and 12 local TV affiliates around the country. It also owns smaller streaming players like TheGrio and Local Now. Beyond The Weather Channel, however, there’s very little that would move the needle for WarnerMedia Discovery.

Scripps — With a $1.7 billion market cap, Scripps comes cheap. Its portfolio might complement WarnerMedia Discovery well. Digital channels like Court TV, ION, and Newsy would diversify a new parent’s holdings. But it’s unlikely WarnerMedia Discovery would want 61 local TV stations in 41 markets. In fact, Discovery snapped up Scripps Network Interactive in 2018, leaving the local networks behind.

Sinclair — At just $2.5 billion, Sinclair would be an easy takeover target for the right buyer. The most tempting property they own might be the coveted Bally Sports Networks. Since AT&T TV is the only streaming service that carries those networks, perhaps WarnerMedia Discovery’s parent has a keen eye on the sports side of things. One factor that makes this deal unlikely? Sinclair owns or operates 193 local TV stations across the country, and that wouldn’t fit the WarnerMedia Discovery plan.

Likely Targets

Sony Pictures — The Sony company is a big one, and it’s possible an electronics manufacturer no longer has interest in making movies. If the right deal was made, Sony could give up its movie and TV enterprise entirely. After all, they’ve become something of a streaming arms broker, lending out their films to services like Netflix and Disney+. WarnerMedia Discovery would probably have a great laugh at snatching Spider-Man away from Disney. Besides Spidey and Venom, Sony owns the rights to Jumanji and Men in Black, and WarnerMedia Discovery could have fun with those. Sony has also been stumbling at the box office beyond those titles, so perhaps new ownership might make sense. But WarnerMedia Discovery already has the physical Warner Bros studios. Would it need another property with Sony’s stages?

Lions Gate — The company behind STARZ has a $4.59 billion market cap, which makes them an attractive target. Some potential buyers might shy away from a company that still operates a linear cable channel, however. It might surprise you that STARZ has incredibly high demand for its content, especially overseas.

CuriosityStream — With a friendly market cap of $860 million, this streaming service could be snapped up by anyone. Its content would go well with Discovery’s brand.

Other Options

WarnerMedia Discovery might not try to buy an entire streaming service, but might focus more on something like a content studio. In this era of intellectual property wrangling, you wonder if the company might back up a truck full of money to JK Rowling’s house to capture the rights to Harry Potter. Or maybe it might snap up Tyler Perry Studios. It’s unlikely those creative powerhouses would sell, but a similar player could emerge.

Beyond an outright acquisition, WarnerMedia Discovery might try to forge some sort of partnership. After all, AT&T didn’t buy Discovery; they set up a new venture entirely. It’s unclear which other players WarnerMedia Discovery might target in such an arrangement, but as the streaming wars go on, the various competitors may need to join forces to stay afloat.

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