7 Companies Owned by Disney

TV and radio networks, production studios, and

publishers
By 
MATTHEW JOHNSTON
 

Updated November 21, 2022

Reviewed by 
MARGARET JAMES
Walt Disney (DIS) has grown into a household name in family
entertainment and a leading international media conglomerate.1 Founded
in 1923 as the Disney Brothers Cartoon Studio by brothers Walt and Roy
Disney, the company now boasts a market capitalization of $335.0 billion.
It generated a net loss of $2.5 billion on revenue of $65.4 billion during its
2020 fiscal year (FY), which ended Oct. 3, 2020.2

Under the leadership of Bob Chapek, who took over from Robert Iger as
the company’s CEO in February 2020, the company operates through the
following business segments: Media Networks; Parks, Experiences and
Products; Studio Entertainment; and Direct-to-Consumer and
International.3 Iger took back the CEO role in November 2022.

Acquisitions are a major vehicle of growth for Disney—and have been over

the past three decades. Studio Entertainment, the foundation upon which
the company was built, is an example. While Disney produces high-quality
video content under its own name, it has used acquisitions to become the
owner of intellectual property rights to its blockbuster film and TV
franchises. It bought Lucasfilm (owner of the “Star Wars” franchise),
Marvel Entertainment (owner of a long list of Marvel heroes, including
Spider-Man and Iron Man), and Pixar (which created the “Toy Story” and
“Cars” franchises and other hits.) The company also distributes content
through three major acquired brands—ABC, ESPN, and 21st Century Fox
—as well as through its own Disney Channel.3 The acquisition of a
majority stake in BAMTech in August 2017 and purchase of 21st Century
Fox in March 2019 were key deals in the company’s launch of digital
content streaming service Disney+.

Below, we look in more detail at the company’s seven largest acquisitions.

KEY TAKEAWAYS
  Acquisitions have helped Disney expand its reach in media and
entertainment—including 21st Century Fox, which it acquired in 2019
for $71 billion.
 Disney became the first media company to have a presence across
filmed entertainment, cable television, broadcasting, and telephone
wires after it bought Capital Cities/ABC.
 Disney acquired “Toy Story” creator Pixar in 2006 for $7.4 billion.
 The company became the owner of the “Star Wars” and “Indiana
Jones” franchises following the purchase of Lucasfilm in 2012.
 In August 2009, Disney bought Marvel Entertainment for $4 billion.
 In 2001, Disney acquired Fox Family Worldwide, which was
renamed ABC Family but was subsequently rebranded as Freeform.
 Acquisition of a majority stake in streaming services company
BAMTech in 2017 played a key role in Disney’s launches of ESPN+
and Disney+.

21st Century Fox (TFCF Corp.)

 Type of business: Global media and entertainment
 Acquisition price: $71 billion
 Acquisition date: March 20, 20194

21st Century Fox emerged from the 2013 split of News Corp., the
sprawling publishing and entertainment empire owned by media mogul
Rupert Murdoch. In the breakup, the publishing arm of the company
retained the name News Corp. (NWS) while the entertainment division,
including the 20th Century Fox studio, was spun off into a separate
company named 21st Century Fox.5

When Disney acquired the company in 2019 for $71 billion, the
entertainment business was renamed TFCF Corp., and many of the news
assets were spun off into a new, separately owned public company called
Fox Corp. (FOX). Through that series of deals, Disney became the owner
of a basket of prized global franchises, including the 20th Century Fox film
and TV studios, cable networks FX and National Geographic, international
TV business Star, and a 30% interest in Hulu LLC. Disney also retained
perpetual rights to certain Fox brands, including 20th Century Fox and Fox
Searchlight.6 The acquisition significantly augmented Disney’s ability to
provide more content and entertainment options to meet growing
consumer demand.4

Capital Cities/ABC
 Type of business: Media
  Acquisition price: $19 billion
 Acquisition date: July 31, 19957

Capital Cities/ABC was formed in 1985, when media firm Capital Cities
Communications acquired American Broadcasting Company for $3.5
billion.8 Disney’s $19 billion purchase of the company in 1995 was
considered the second-largest corporate takeover ever, bringing together
two of the world’s leading media and family entertainment companies.7

Through the deal, Disney acquired TV stations, radio stations, a

percentage of ESPN, The History Channel, A&E Network, Lifetime
Television, and a publishing group.9 It transformed Disney into the first
media company with a major presence in the four key distribution systems
of filmed entertainment, cable television, broadcasting, and telephone
wires (through a joint venture with three regional phone companies). The
deal also expanded Disney’s overseas presence, as Capital Cities/ABC
was already distributing ESPN abroad.7

 
In November 2019, Disney launched its Disney+ streaming service, a paid
subscription service that competes with the likes of Netflix, Hulu, and
Apple TV.

Pixar Animation Studios

 Type of business: Computer animation studio
 Acquisition price: $7.4 billion
 Acquisition date: Jan. 24, 200610

Pixar was created in 1986 when Steve Jobs, the legendary co-founder of

Apple, bought the computer animation division from Lucasfilm, which
made major progress in perfecting animated film technology. Under Jobs,
Pixar turned into the world’s premier animated film producer. It created
“Toy Story,” the world’s first computer-animated feature film, as well as
movies such as “Finding Nemo.”

Disney’s $7.4 billion purchase of Pixar in 2006 made it an instant leader in

animated films. Under Disney, Pixar has produced films such as “Cars,”
“Ratatouille,” “WALL•E,” and several sequels to “Toy Story.”11

Lucasfilm Ltd.
 Type of business: Film and TV production company
 Acquisition price: $4.1 billion
 Acquisition date: Oct. 30, 201212
Lucasfilm was founded in the San Francisco Bay Area in 1971 by
filmmaker George Lucas. The studio is best known for creating and
producing the blockbuster “Star Wars” and “Indiana Jones” franchises and
has been a leader in developing special effects, sound, and computer
animation.13

Disney’s acquisition of the company in 2012 gave it access to the

distribution rights of those high-grossing franchises. Disney also has
leveraged those franchises through its theme parks and resorts, such as
the “Star Wars: Galaxy’s Edge”-themed entertainment area at Disneyland
and Disney World.

Marvel Entertainment
 Type of business: Entertainment
 Acquisition price: $4 billion
 Acquisition date: Aug. 31, 200914

The precursor to what would become Marvel Entertainment was founded

in the 1930s under the name Timely Comics. The comic book publisher
went through various name changes, different ownerships, filed
for bankruptcy, and developed into a premier creator and publisher of
entertainment media with a library of 5,000 characters, including Spider-
Man, Iron Man, X-Men, Captain America, and the Fantastic Four.151617

Disney leveraged its $4 billion purchase of the company to accelerate the

number of movie releases starring Marvel characters, including box office
hits such as “The Avengers” (2012), “Iron Man 3” (2013), “Black
Panther”  (2018), and many more.18

Fox Family Worldwide

 Type of business: Media and entertainment
 Acquisition price: Approximately $5.2 billion ($2.9 billion in cash, plus
the assumption of $2.3 billion in debt)1920
 Acquisition dates: July 23, 2001 (announced);21 Oct. 24, 2001
(completed)19

Fox Family Worldwide was formed in 1995 by a joint venture (JV) between

Haim Saban and Fox Broadcasting, an affiliate of billionaire Rupert
Murdoch’s News Corp. Prior to being acquired by Disney, the company
had become one of the world’s leading vertically integrated global family
and children’s entertainment companies.22 Through the deal, which
occurred in late October 2001, Disney acquired the Fox Family Channel in
the U.S., which had about 81 million subscribers, as well as Fox Kids
channels worldwide.20

The acquisition was seen as a move by Disney to keep pace with its
competitors during a period of consolidation in the media industry.23 It
also gave Disney the rights to 6,500 episodes of children’s and family-
friendly programming, as well as rights to show Major League Baseball
games.21 Disney renamed the network ABC Family Channel.19 It has
since been rebranded as Freeform.24

BAMTech LLC
 Type of business: Streaming services
 Acquisition prices: $1 billion in two installments (33% stake);25 $1.6
billion (additional 42% stake)26
 Acquisition dates: Aug. 9, 2016 (33% stake);25 Aug. 8, 2017
(additional 42% stake)26

BAMTech LLC originated out of Major League Baseball Advanced Media

(MLBAM), the interactive media and Internet company formed by Major
League Baseball (MLB). The company first began livestreaming MLB
games in 2002. In 2007, it launched a video streaming app on Apple Inc.’s
(AAPL) iTunes store. Over the next eight years, BAMTech launched the
WWE Network streaming service, HBO NOW, the PlayStation Vue
livestreaming TV service, and more. In 2015, the company was spun off
from MLBAM.27

In 2016, Disney acquired a 33% minority stake in BAMTech, which by then

had become a global leader in direct-to-consumer streaming services, data
analytics, and commerce management.25 The deal came with an option
for Disney to acquire majority ownership, which it exercised a year later,
purchasing an additional 42% stake for approximately $1.6 billion in 2017.
The acquisition of a majority stake in BAMTech provided Disney with the
assets that it would use to launch video streaming services ESPN+ in 2018
and Disney+ in 2019.282926

Marvel Entertainment LLC - SWOT Analysis SWOT Analysis - Overview Marvel Entertainment LLC
(Marvel) is one of the world’s most prominent character-based entertainment companies. The
company leverages its brand equity and business model to commercialize its products in the
marketplace with ease, even as copyright infringement suits and private ownership are cause for
concern. Nevertheless, growth in entertainment and movies industry in the US, growing trend of
online shopping and growth in consumer spending in the US could offer growth opportunities for the
company. However, intense competition and counterfeit products could affect the company’s
profitable growth. Marvel Entertainment LLC - Strengths Strength - Support from the Parent
Company As a subsidiary, Marvel could capitalize on the global brand value, operational presence,
financial capabilities and strategic collaborations of The Walt Disney Company (Walt Disney), is a
renowned entertainment company that offers an array of family entertainment and media
enterprise solutions. The company operates carries out operations through media networks; parks,
experiences and products; studio entertainment; and direct-to-consumer and international (DTCI).
Apart from operating popular Disney parks across the world, Walt Disney commercializes toys,
apparels, books, fine arts, stationery, footwear, consumer electronics and magazines. The company
also produces television production, television distribution, live-action and animated motion
pictures, musical recordings, direct-to-video content and live stage plays. In FY2020, Walt Disney
Company generates US$65,388 million revenue. Strength - Strong Business Model Marvel capitalizes
on multiple businesses in the international family entertainment and media market. The company
licenses its characters for varied uses and applications. It facilitates the use of characters for creation
of entertainment projects, variety of consumer products inclusive of apparel, interactive games,
electronics, home wares, stationery, DVD/home video, video games, gifts and novelties, footwear,
food and beverages and collectibles. Marvel licenses its proprietary characters for use in shopping
malls, theme parks, restaurants, special events, motion pictures and others. Marvel also involves in
developing and publishing comic books and trade paperbacks principally in North America. The
company also produces and distributes feature films. Marvel also involved in marketing toys,
clothes, homegear and collectibles, among others through its online properties. Such business model
makes it less sensitive to the market fluctuations. Strength - Brand Identity Marvel enjoys a strong
brand identity that provides it an edge over its competitors while attracting and retaining a loyal
customer base. It is one of the most prominent character based entertainment companies in the
world. The company owns a proprietary library of more than 8,000 fictitious animated characters
featured in a variety of media over 75 years. These characters include world renowned Spider-Man,
Iron Man, Thor, The Avengers, Ghost Rider, Captain America, The Fantastic Four, The Incredible Hulk,
X-Men (including Wolverine), Blade, Daredevil, The Punisher, Namor, Nick Fury, Silver Surfer and
Ant-Man, among others. It is a collection of brands through which the company strives to gain edge
over its competitors.

Weakness - Copyright Infringement Suits Involvement in various lawsuits and legal proceedings
could affect the company’s brand image. It also needs significant commitment on the cost and
management resource front. In 2017, the US District Court for the Southern District of New York,
grants in part and denies in part Marvel’s motion to dismiss copyright infringement claims alleging
similarities between Marvel’s Iron Man character and plaintiff’s Radix comic book. The court
concluded that no protectable similarity existed between artistic depictions of mechanized body
armor used in Iron Man films and mechanized armor used in Radix, but that similarities sufficient to
survive motion to dismiss existed between promotional poster for Iron Man 3 and promotional piece
of art for Radix. Earlier, Ben and Ray Lai, owners of Horizon Comics, filed a copyright infringement
lawsuit against Marvel Entertainment, Marvel Studios, The Walt Disney Company and others. The
plaintiff alleged unauthorized copy of mechanized body armor wore by its Radix comic characters, in
Marvel and Walt Disney’s Iron Man movies. Weakness - Private ownership Marvel being a private
company it does not disclose any financial information to the public. Despite having a professional
management, the company is still mired by the various challenges that a privately-owned company
faces. It has limited management layers and as a result, the decisions are always taken by few
members, which might be detrimental for the company. On the other hand, public limited
companies have an edge over private companies as they are required to have sufficient members on
the management and company’s board, which provide a wider perspective of any business dilemma
and provide decision making easier and efficient. These companies are also mandated to disclose
their financial and operational activities, which in turn provide transparency in their operations and
generating goodwill. This helps the public companies raise funds from the market at favorable terms,
as private ownership puts the company at a disadvantage over its public limited counterparts.

Marvel Entertainment LLC - Opportunities Opportunity - Consumer Spending in the US The company
could benefit from the increase in consumer spending in the US. Growing personal income,
disposable personal income and personal consumption expenditure indicate improvement in
consumer spending in the US, which could increase the purchase of the company’s products and
enhance its performance. According to the US Bureau of Economic Analysis (BEA), in January 2020,
the personal income (PI) in the US increased 0.2% or US$40.7 billion; disposable personal income
(DPI) increased 0.2% or US$30.6 billion and personal consumption expenditure increased 0.3% over
that in the previous month to reach US$46.6 billion. In December 2019, real personal consumption
expenditure (Real PCE) increased 0.1% over that in the previous month. The personal consumption
expenditure PCE price index increased 0.3% over the previous month. Opportunity - Growth in
Entertainment and Movies Industry: US The growing entertainment and movies industry could help
the company garner higher market share as well as enhance its revenue stream. The company
operates various divisions such as studio entertainment and consumer products. Hence, the
company has an opportunity to increase its sales with the strong industry growth projected in the
coming years. According to in-house research, the movies and entertainment market in the US is
forecast to reach a value of US$27,366.5 million by 2023, an increase of 2.9% since 2018. The US
accounts for 33.1% of the global movies & entertainment market value. The movies and
entertainment market comprises the following segments: video retail, box office, and music sales.
The latter remains significant, although the two film segments account for the majority of this
market. Category wise, music and video is expected to be the largest segment of the movies &
entertainment market in the United States, accounting for 55% of the market's total value.
Opportunity - Online Retail Market: US Marvel operates a network of online properties and could
benefit from the positive outlook of ecommerce market. According to in-house research, online
retail sector in the US is forecast to grow at a CAGR of 11.5% during 2018-23 to reach US$636.1
billion by 2023 from US$368.5 billion in 2018. Online Pureplay form the leading distribution channel
in the United States online retail sector, accounting for a 53.3% share of the total sector's value,
while Multi-Channel Retail accounts for a further 46.7% of the sector. The US accounts for about
30.9% of the global online retail sector value. The retailing of electrical and electronic goods was the
largest segment in the sector in 2018, which accounted for 32.7% of the total value, followed by
apparel retail (21.2%), home and garden products (16%), food and grocery retail (8.7%), furniture
and floor coverings (7.1%), footwear (4.1%) and other category accounted for 10.2% of the value.
The company’s products are sold through e-commerce portal www.biocurv.com. By providing
assurance to customers about credit card payment security and timely delivery at minimal cost,
more product information and availability, user friendly features and other technological
enhancements, the company may further enhance its online sales and benefit from increased
revenue.

Marvel Entertainment LLC - Threats Threat - Intellectual Property Risks Marvel’s market position
depends on its ability to obtain patents for its technologies and products, to defend its patents, to
protect its trade secrets and to operate without infringing the valid patents or trade secrets of
others. The company’s intellectual property assets includes library of proprietary characters, the
stories that have published for decades, the associated copyrights, trademarks and goodwill and
Marvel and Marvel Comics trade names. The company's principal trademarks have been registered
in the US and in certain of the countries in Western Europe, Latin America, Asia Pacific, the Middle
East and Africa. Failure to protect its patent rights could adversely affect the company’s competitive
position and financial condition. Threat - Competitive Market Intense competition could challenge
the company’s profitable growth. Marvel operates in a highly competitive environment
characterized with technological changes and the launch of new programs. The company competes
with entities that own intellectual property rights in characters such as DC Comics, DreamWorks
Animation, LLC. and others. It also competes with numerous publishers in the US including DC
Comics, which is a part of integrated entertainment companies and have greater financial and other
resources than Marvel. The company also competes with film producers such as Twentieth Century
Fox and Sony Pictures. In the consumer products business, Marvel competes with Iconix Brand
Group, Phillips-Van Heusen, Mattel and Warner Bros Consumer Products, among others. Such
competition could affect the financial condition of the company materially, if not responded on a
regular basis. Threat - Counterfeit Market Piracy of television programming, video content, apparel
products and other goods of the company poses significant challenges to the company's businesses.
Technological advances allowing the unauthorized dissemination of motion pictures, television
programming and other content in unprotected digital formats increase the threat of piracy. Such
technological advances make it easier to create, transmit and distribute high quality unauthorized
copies of the original copyrighted content. The proliferation of unauthorized copies and piracy of the
company's products could reduce its revenues. The company generates revenue through its
character based clothing and goods such as bags and watches, which is highly vulnerable to
counterfeit market. Such market scenario is a major threat to the company. NOTE: The above
strategic analysis is based on in-house research and reflects the publishers opinion only