Discovery And Scripps: An Odd Couple In A Merger

7/27/17

By Jay Wei, Investopedia

Discovery Communications, Inc. (DISCA) and Scripps Networks Interactive, Inc. (SNI) would be mistaken if they believed a merger between the two could magically transform them into a media darling to both content distributors and viewers in general. Peculiar content of sometimes obscure scientific subject matters in Discovery’s programming is mostly a mismatch with Scripps’ light-hearted and predictable lifestyle portrayals in food and living. The two companies can remain independent and still make a name for themselves despite current, disruptive content distribution environment, if they could take into their own hands the increasingly popular online streaming services.

The well-known logic that network owners can gain leverage with content distributors by expanding their channel lineups through combined operations has become more of a faulty one, given the availability of today’s multi-distribution platforms. Instead of fighting traditional pay-TV distributors for higher distribution fees, content owners may take some distribution tasks into their own hands when self-streaming one’s own content has become readily available. This is especially appropriate for smaller media companies like Discovery and Scripps, as they have a narrower number of core followers and can target their potential online subscribers more easily.

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