Apple Should Buy Disney
Apple: Laura Martin, a media and entertainment analyst with Needham & Company, has suggested that an acquisition of Disney by Apple could create value for both companies. She argues that a merger could benefit Disney by capturing revenues that are currently lost through partners and companies that benefit from Disney’s products.
Martin refers to this as “value leakage.” Disney attracts millions of viewers and visitors, but it does not make money from related products, such as movie theater popcorn or plane tickets to Orlando.
Martin suggests that if Disney had a “leakage” of value similar to that of Aple, which she calculates at around 10%, Disney’s market cap would be closer to the US$ 2.6 trillion of Apple, instead of its current market cap of US$ 180 billion.
Martin notes that while Disney loses revenue, it gains market allies, making it too big to fail. She argues that Apple and Disney have complementary businesses and networks, which could lead to reduced costs in content production and distribution. Martin suggests that the deal would not have great difficulties being approved by regulators, as it is a vertical transaction with no big overlap.