In the war for the future of media, few battles will be market-altering as that of Comcast versus Disney for the acquisition of Fox. In late 2017, Disney announced that it would be buying out Fox, only to find its deal threatened by a potentially sweeter offer from Comcast. There is some history between the companies: In 2004, Comcast made an unsolicited bid for Disney, which was (disdainfully) rejected. Regardless of who wins the war, the resulting conglomerate will reorient the landscape of TV.

What’s the deal?

While Comcast’s $65 billion cash offer may seem like the hands-down winner in a bidding war, the details of the deal are what matter. Disney’s offer is for $52.4 billion in its stock, which has tax advantages (taxes on the $65 billion in cash would need to be paid upfront, while the taxes on the stock would have to be paid further down the road when they are cashed in) and the ability to increase in value. Comcast would also need to work within the confines of Disney’s current deal with Fox, which means that Disney could still make a more attractive offer.

Comcast (or Disney) would get quite a bit for its money, including Fox’s movie studio, its cable networks and some local sports TV networks. The company would also get 20th Century Fox Television and, perhaps more importantly, 30 percent ownership of Hulu. To sweeten the deal, Comcast is also throwing in billions of dollars of fees in case regulators cause trouble or Fox has to pay off Disney for not going through with their initial agreement.

Comcast eyes the future of media

Comcast, like Disney, is looking hard at the future, and that future looks different for pay TV. It has been estimated that about 25 percent of pay TV customers will be streaming by 2023, with many more expected to follow as the technology spreads globally. Comcast is moving quickly in an attempt to stay relevant, knowing that there is much to gain from Fox’s library of content that it can stream over its networks. Amazon and NetFlix are viewed as serious opponents with a tech edge that Comcast is only starting to capitalize on.

The road to the future has not been an easy road for the cable giant. Not only has it been snubbed by Disney, but it is also wary of antitrust regulation that could cause significant problems for the deal. However, since the Justice Department’s attempt to block the AT&T’s acquisition of Time Warner went nowhere, Comcast now feels more confident in its position.

Comcast/Fox deal, not all sunshine and roses

Comcast is the U.S.’ largest cable provider, and this deal will have a powerful effect on the company. Comcast investors have already punished its stock price, sending it down 17 percent since the beginning of the year. A successful bid means the company will be dragging along a much higher debt load, to the tune of $170 billion. This big bump in its debt would likely trigger a credit rating downgrade, increasing the cost of borrowing for the cable giant. The need to eliminate at least some of this debt might force Comcast to rethink its approach to investors, even perhaps pulling its projected dividend. What happens next?

Since the deal is still not done, anything can happen. There are a number of options that are possible. For example, the current deal between Fox and Disney could simply go through as is, where Fox sells off parts of its business to Disney, creating a powerful media conglomerate. Fox could get a little greedier and cast some glances at the Comcast offer, forcing Disney to pony up extra cash or include other offerings to sweeten its deal. Fox could possibly even be willing to partition out certain of its offerings to both suitors, easing some of the regulatory issues that could arise. Or Comcast could win the bid, becoming a much stronger global content provider.

Cable TV will never be the same

Needless to say, if either merger goes ahead, there will be a significant impact on media, especially cable TV. In the deals with either company, the remains of the old Fox would evolve into New Fox, which would include the Fox Television Stations Group (28 TV stations), the Fox Broadcasting Company television network and a few other parts of the old Fox, such as its News Channel, Sports, Big Ten Network and Spanish-language Deportes. (There would therefore still be four major TV networks.) The merger would provide either Disney or Comcast with a strong presence in the U.S. market while vastly expanding their global offerings. The enormous stake in Hulu is large enough to allow the company to dominate the streaming service and perhaps dominate competitors. (The winner, of course, will also scoop up all the rights to many popular franchises, such as X-Men, The X-Files, Die Hard and Avatar.)

The impact of the merger will be ongoing. Media consolidation means that fewer players will be controlling more content and the delivery of that content, which could create issues for smaller businesses trying to break into the market and consumers. Consumers who get cable are more likely to pay more for their bundled services, which may result in more of them moving away from traditional cable operator pay TV bundles. In general, customers are moving toward cable providers, which are evolving into ISPs with a range of services, for their entertainment desires and internet.

Regardless of who wins the deal with Fox, the landscape for cable is shifting. Technology is forcing changes in how content is delivered and packaged. The future of the cable marketplace is a landscape where increasing numbers of companies compete as ISPs to deliver content to a broad consumer base.