Apple has no real history with big ticket acquisitions, but it should make an exception for Disney’s ESPN as it hones its live sports focus on its Apple TV app and Apple TV+ service, according to Wedbush Securities analyst Daniel Ives.
Ryan Vlastelica for Bloomberg News:
An acquisition or strategic partnership with the sports channel would be “a no brainer,” wrote analyst Dan Ives. He said that buying ESPN would probably cost more than $50 billion, but would “make a ton of strategic sense” by giving Apple valuable sports content, major TV rights, and “change the cross-sell opportunities and attractiveness of Apple TV looking ahead… Apple recognizes that in this streaming arms race there is a ‘closing window’ for the stalwart to acquire content and cement its footing in the live sports content arena.”
Disney has signaled it’s considering selling or finding strategic partners for its broadcast and cable television assets. Executives have signaled they’re looking to sell a stake in ESPN to a partner that can help accelerate the network’s transition to streaming.
To Ives, this suggests ESPN “potentially may be on the table in one form or another.” Other analysts have advocated for Apple buying Disney outright.
MacDailyNews Take: If Apple wants to the Apple TV app / Apple TV+ service to be known as the home of sports, they could do worse than acquiring ESPN. That said, ESPN has myriad issues from straying from its mission (sports) to declining revenue, profits, and affiliate fees to exploding costs for broadcast rights to employee pay. An Apple acquisition or strategic partnership could solve several of these issues. It would literally be a game-changer for ESPN and, properly structured, for Apple’s SVOD services, too.
I think sports is still a great unifier. So it’s one thing that we can all rally around, and people put their other interests aside to either fight the other side or to hopefully join forces. – Apple CEO Tim Cook, calling into an ESPN sports talk show in April 2019
Whenever anybody says Apple doesn’t make any big acquisitions, there’s one very big exception: Apple has purchased $500 billion worth of Apple since 2012.
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