Steve Burke on Comcast’s Surprise Sky Bid, Fox-Disney Deal
Comcast’s flirtation with buying 21st Century Fox helped inspire the media conglomerate’s surprise bid for Sky, Steve Burke told a Wall Street-heavy crowd on Wednesday.
Burke, who serves as executive VP of Comcast and president and CEO of NBCUniversal, acknowledged that the company had been in the hunt for the bulk of Fox’s film and television assets before ultimately losing out to Disney.
“They chose to go a different direction and we said win some, lose some,” Burke said at the Morgan Stanley Technology, Media & Telecom Conference. However, the aspects of Rupert Murdoch’s business that attracted Comcast to Fox continued to drive the itch to acquire.
“We have a lower percentage of our revenue from international than I wish we did,” Burke said.
Fox, Burke argued, had done a good job of building up its overseas operations — a portfolio that includes a 39% stake in Sky, a European pay-TV giant. Fox has been trying to buy Sky outright, but its proposed acquisition has been bogged down in a lengthy regulatory review by British authorities. Comcast’s ￡22 billion ($31 billion) offer for Sky, represents a 16% premium on the existing bid by Fox. Burke said the potential to grow Sky’s business mirrored what Comcast did with NBCUniversal after buying the film and television company in 2011.
“The more that we thought about Sky, the more we realized that it was so similar to what we built with NBCUniversal,” said Burke, who praised Sky’s foreign reach and set top box technology. With Sky in its quiver, international operations would account for 25% of Comcast’s revenues, up from less than 10%.
“We know a lot about the company and we’ve been following the company for a long, long time,” he said.
Burke’s remarks come amidst consolidation in the media space. Disney is buying most of Fox, AT&T is trying to purchase Time Warner, and there are murmurs that CBS and Viacom will soon join forces. Burke argued that Comcast, which distributes programming as a cable operator and creates content as the owner of a film and television studio, is well positioned in an age of ever expanding conglomerates. He also maintained that Comcast’s Universal Studios’ theme parks and consumer products divisions are a competitive advantages.
“We have as good a hand as anybody,” Burke said.
The NBCUniversal chief’s enthusiasm for the business was bolstered by his network’s recent success with the Super Bowl. Thanks to robust ad sales, the Philadelphia Eagles’ surprise victory over the New England Patriots turned out to be a major coup for NBC. Burke said the company generated $100 million in profit from the big game.
“We think it might have been the most profitable night of television in history,” said Burke.
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