The Walt Disney Company

The Walt Disney Company’s $71.3 billion acquisition of 21st Century Fox stands as one of the most consequential mergers in the history of the media industry. While the deal significantly expanded Disney’s content library and bolstered its presence in sports broadcasting and streaming, it was also a defensive maneuver aimed at countering the rapid rise of streaming competitors like Netflix, Amazon, and Apple. Yet, despite the apparent strategic benefits, the merger sparked concerns over market concentration, pricing power, and antitrust implications—particularly in Latin American markets such as Mexico and Brazil, where regulators meticulously scrutinized the transaction.

Strategic Motivations Behind the Deal

Disney pursued the acquisition primarily to strengthen its content portfolio and maintain relevance in a rapidly evolving media landscape. Streaming services were capturing global audiences at an unprecedented rate, making content ownership a critical competitive advantage. By acquiring Fox, Disney aimed to: Expand its intellectual property holdings, incorporating franchises such as X-Men, Avatar, and The Simpsons. Enhance its position in sports broadcasting, particularly across Latin America. Bolster its streaming platforms, Disney+ and Hulu, with a broader, more diverse content library. This move was not merely expansionist—it was a strategic necessity to ensure Disney remained a dominant player against tech-driven media rivals.

Financial Scope and Global Reach

Finalized in July 2018, the $71.3 billion deal encompassed Fox’s film and television studios, cable entertainment networks, and international operations. However, it excluded Fox News, Fox Broadcasting, and Fox Sports, which were spun off into a separate entity, Fox Corporation, retaining control under Rupert Murdoch.

In Mexico, the merger drew particular attention due to concerns over channel concentration. Disney and Fox collectively controlled over 70% of pay-TV channels in the country, a near-duopoly that raised red flags for regulators and competitors like Televisa, which held a 27% market share. The Federal Telecommunications Institute (IFT) closely examined the merger, wary of potential anti-competitive pricing and market manipulation.

Regulatory Challenges and Concessions

To secure approval in Mexico, Disney offered concessions, including pledges not to raise prices for competitors over a five-to-six-year period. Nonetheless, skepticism persisted: Fox had announced a planned price increase for popular channels before the merger, stoking fears of post-merger exploitation. Similar mergers faced antitrust hurdles in the United States, Europe, and Brazil, where authorities blocked portions of the deal over sports content concentration. In response, Disney revised its submission to the IFT in February 2019, providing additional assurances to protect Mexican consumers and preserve competitive balance.

Political Interventions and Delays

The Mexican merger approval process became further complicated by political involvement. President Andrés Manuel López Obrador’s administration voiced concerns about reduced competition and the potential impact on consumers, delaying the IFT’s decision until late February 2019. This politicization introduced uncertainty, emphasizing the strategic importance of Latin American regulatory approval for the broader corporate transaction.

Global Implications and Strategic Risks

The success of the Disney-Fox merger in Mexico and Brazil was critical to the overall acquisition. The deal included “condition precedent” clauses, meaning failure to secure regulatory clearance in these markets could have triggered renegotiation or divestiture requirements in the United States. Consequently, Latin America became a focal point for global media consolidation efforts.

Strategically, the merger positioned Disney as a dominant force in pay-TV, controlling nearly 40 channels in Mexico alone. However, the concentration of sports content prompted concerns about potential market manipulation and price control, raising questions about consumer welfare and competition. Simultaneously, the enhanced content library strengthened Disney’s streaming offerings, intensifying competition with Netflix, Amazon Prime, and Apple TV+.

Conclusion

Disney’s acquisition of 21st Century Fox reshaped the global media landscape, giving the company unprecedented leverage in content production and distribution. While the merger fortified Disney against streaming rivals and expanded its intellectual property portfolio, it also highlighted the growing complexity of international regulatory oversight, particularly in Latin America.