What's going on?
Italian big spending found friends in Europe for a change on Wednesday: Mediaset, Italy’s largest broadcaster, announced it had bought a 10% stake in Germany’s ProSiebenSat.1.
What does this mean?
Mediaset wants European media companies to join forces to stand a better chance against global rivals. The imaginatively named company may hope its set of market-leading Italian and Spanish businesses can complement Prosieben’s German-speaking audience as the two try to make some of their investments go further together. But they’re up against Netflix’s estimated $15 billion war chest to spend on new content this year – and it just picked up the rights to the two best films at this year’s Cannes Film Festival.
Why should I care?
For markets: It’s hard for Europeans to be American.
European media companies have tried to mirror their American cousins by buddying up. But while US regulators approved Disney and Fox’s fairytale marriage and telecoms leviathan AT&T’s timely purchase of media giant Time Warner last year, European officials forced French media conglomerate Vivendi to split off most of its near-30% stake in Mediaset – and then blocked Mediaset’s attempt to partner with Sky’s Italian arm (now in Comcast’s hands) to limit their influence. Still, Vivendi’s television studio Canal+ announced a $1 billion acquisition of an independent pay-TV company this week, perhaps looking to follow in Netflix’s golden footsteps.
For you personally: Square eyes seem unavoidable.
Television’s been a fixture in living rooms for as long as most of us can remember. And while Netflix, Amazon, and soon Disney may displace some traditional TV, they’re all competing for eyeball time with social media, games, books – and occasionally even family. That desire to hold viewers’ attention may partly explain the rise of oft-surreal and frequently questionable “reality TV”. Still, daytime TV may catch a break with Germany’s unemployment rate rising this month for the first time since 2013. Cue a few more idle eyes on whatever’s trending…