Get big or die trying has become the strategy of Europe’s traditional broadcasters. Merger mania is everywhere.
Last month, Comcast‘s Sky signed a $2.13 billion (£1.6 billion) deal to acquire British commercial broadcast giant ITV. Last year, MediaForEurope (MFE), the TV group controlled by the Berlusconi family, took majority control of German commercial network ProSiebenSat.1, adding to its pan-European conglomerate that includes Mediaset, Italy’s largest broadcaster, and Spain’s top commercial network Telecinco.
The reasoning behind this consolidation is simple. European TV companies, seeing a decline in traditional advertising and fierce competition from streaming companies and online video giants like YouTube, have realized scale matters. If they are not to be wiped out completely, legacy broadcasters need to shift their business online — to digital ad and streaming subscription models — while staying big enough to still be profitable.
RTL Group, Europe’s largest television company, is also playing the merger game. In June, RTL, which owns production giant Fremantle and is itself a subsidiary of German media conglomerate Bertelsmann, closed its acquisition of Comcast’s German pay-TV operation Sky Deutschland, folding it into its RTL+ streaming service. The combined platform, with 12.4 million paid subscriptions, is now the third-largest streamer in German-speaking Europe, behind Netflix and Amazon Prime. In France, where RTL owns commercial channel M6, it is investing heavily in its streaming platform M6+.
