As it bids $31 billion for Sky, Comcast sees the UK company not as a satellite TV operator, but as a “platform-agnostic, pan-European content brand” that can be leveraged to launch a global over-the-top service, cable industry analyst Craig Moffett said.
“Sky brings with it a trove of exclusive content and rights that could be the basis of an OTT service with a genuine moat, capable of rivaling Netflix itself,” Moffett wrote in a note to investors Monday morning.
Moffett might be the Sky deal’s biggest critic. He describes the aforementioned perspective as “what one wishes the business to be, even if it is one with many risks and potential disrupters (Amazon, Google, Disney, and AT&T all come to mind).
“Against this optimistic scenario,” he added, “is the business that actually is. Sky is a slow-growth still-primarily-satellite distribution business in a fairly mature video—and even more mature broadband—ecosystem. With some proprietary content rights.”
Moffett also noted that since making its Sky bid announcement on Feb. 27, Comcast has lost around $11 billion in enterprise value.
In his initial reaction to the bid last month, Moffett noted, “Yes, Sky is more than just a direct-to-home satellite TV distributor, but … well, let’s face it, Sky is a direct-to-home satellite TV distributor. And yes, Sky is also a broadband provider, … but it is a resale broadband platform, not a facilities-based one, and therefore it is one that, unlike in the U.S., lacks any competitive advantage whatsoever.”