The latest merger rumor, first floated Friday and continuing into Monday, is that Disney is in discussions to possibly buy Netflix outright, in a deal that would provide the media giant with its first solid streaming platform though it already owns a 30 percent stake in Hulu, which it would likely have to give up if this deal went through. MarketWatch has the report, though they have no comment from either company to confirm or deny. And this deal comes just a week after the rumor was that Disney was looking into the possibility of a Twitter purchase as well.
Shares of Netflix bumped up 6 percent since Monday on the rumor, and the company's stock has otherwise been slipping a bit this year as their subscriber growth has slowed.
Consumerist notes that at least one market analyst, William Power of R.W. Baird, told clients recently that while Netflix has been the subject of "recent [mergers and acquisitions] rumors," it's too soon to say whether it could be Apple, Disney, or some other major suitor who will snap them up.
And while Disney did $2 billion at the box so far this year, movies aren't the company's biggest money maker anymore that's cable TV. As parent company to networks ESPN, A&E, Lifetime, as well as ABC and ABC Family, they'd have much to gain from owning their own streaming platform, particularly in the realm of live sports, as Market Watch points out. And as of 2012, they already struck a deal to let Netflix be the exclusive streaming platform for Disney films and content, a deal that took effect just this year.
But, buying Netflix would be a major thing for Disney financially. As Fortune explains, Disney may have a market cap of $150 billion, but Netflix is valued at $45 billion and Disney would probably have to shoot above that price to get them to agree. It could be worth it, though, because it "would put to rest the whispers about Disney’s future in one fell swoop."
And it makes great sense for Netflix, too, which has been struggling with a $6 billion annual production budget for new content.
The Twitter deal, which could possibly occur in the next month, remains an open question, but chances are the semi-struggling company will become a new asset for Microsoft, or maybe Salesforce.
In summary, it's that time of year/boom cycle, when the big guys start swallowing up the less big guys.
Stay tuned.
Previously: Microsoft And Disney Floated As Suitors In Twitter Sale, Which Could Be Imminent