Discovery Communications Meets Scripps Network

On Monday, Discovery Communications acquired Scripps Network Interactive for $14.6 billion to include debt, or $90 per share. This deal is said to appeal to a broader audience and increase the company’s negotiating tactics with online streaming services.

Both media companies focus similarly on reality and lifestyle programming, but the audiences for the teleco’s TV shows are completely different. On Discovery Communications, there are TV shows like Animal Planet and Discovery Channel, and the audience of these shows are largely male viewers. Shows on Scripps Network interactive appeal to many more female viewers with networks like Food Network, HGTV and Travel Channel.

The companies are also trying to expand their short-term videos attributed to the large amount of mobile consumption. Since most people spend much more time online than watching TV, the new company plans to add more web videos. In fact, they plan to share over 7 billion web videos each month that are going to be short forms of original streams. Since Scripps has already been successful with it’s web video presence, their expertise will support Discovery’s Group Nine Media.

The teleco team will cut costs over $350 million. They will also hold more leverage with distributors and media buyers and this power is becoming increasingly important due to the competition of online streaming services.

Discovery has a large international presence, but Scripps does not. Because of this collaboration, Scripps will be able to expand their global presence, which is something it has been trying to do for a long time.