“It is a truth universally acknowledged, that a single large tech company in possession of a good fortune, must be in want of a media operation.”
Paramount Global has a market cap of $7.5B (net of debt), pocket change in the scheme of things.
Entertainment: It brings a media library from CBS, Showtime, Paramount, and scores of CableTV channels. These would fulfill the promise of AppleTV+, not just with new programs, but a back catalog which the service is missing.
News: CBS brings the last respected name in live news, which would complement AppleNews+.
Music: Classic MTV and VH1 (not the more recent reality-TV incarnations) and CMT would strengthen AppleMusic with a better videos and music programs library.
Sports: It has live sports, which could induce more stickiness.
Advertising: CBS and cable networks were built on advertising, those are domains that complement the web and in-app advertising which Apple aims to support.
It is global, not just a US play, with media assets in many countries.
I believe Paramount as a company is undervalued due to its weird corporate structure and excessive debt accumulated, and is not seen as successful in streaming with its confused branding.
Obviously it's in a very different industry than classic Apple. But Apple made a decision to get into media, it needs to fish or cut bait. It should buy out National Amusements and Paramount Global, and hold it as an independent company in its portfolio.
It can then trade over its AppleTV+ and Apple News divisions to that organisation (as no one not already in the Apple Ecosystem watches anything on AppleTV+).
It would feature the Paramount+ on Apple devices, (but allow it to also be seen everywhere else Paramount+ can already be found, which is why the independence matters). By recapitalising Paramount, wiping its debt, and putting under a stronger managerial team without having to supplicate to the daily vagaries of Mr. Market, it should be able to create value.
