With media mega mergers like AT&T acquiring Time Warner in a $85 billion dollar deal or Sprint acquiring T-Mobile US, the question “What’s next?” is more pressing than ever. Manuel Koch, editor-in-chief of German news outlet Inside Wirtschaft sat down with Tobias Jaeger to discuss recent and pending US and European M&A activities in the media & entertainment industry, exploring possible answers to the question about the future.

Tobias Jaeger
Jun 24 · 6 min read

Tobias Jaeger sat down with Inside Wirtschaft editor-in-chief Manuel Koch to discuss the current merger and aquisitions trends and shifts happening in the media & entertainment industry. With big telco companies like AT&T and Sprint all pursuing their own global expansion strategy, Manuel Koch asked Tobias Jaeger about the reasons for the combined double-digit billion dollar amounts being invested into original content.

“The price tag is just amazing. On the other hand and that is always the hope in a merger, the new company will have brand new synergies and efficiencies and will have it easier to earn back the purchase price. It’s very difficult to predict how the market will evolve but doing nothing is also not an option.”

Watch the original interview in German on Inside Wirtschaft’s YouTube channel.

The below conversation is a translation of above video which was originally recorded in German.


Manuel Koch: Welcome ladies and gentlemen to Inside Wirtschaft. Today we have having a closer look at the media industry. Currently, there are many mergers in progress, telco giant AT&T is about to buy media giant Time Warner for a supposed price tag of $80 billion. Joining us today is Tobias Jaeger, investment banker at AXIOM Venture Capital. Thank you for being here. What is your assessment of the mergers ahead, is that a shift in the world of media?

Tobias Jaeger: Yes, I think the shift we are seeing is that these huge companies, that own so many customers directly as part of their network and cell service, have woken up to the fact that they must offer content directly. Buying a media company with a ton of content and huge library obviously creates great synergies that can be leveraged to offer their subscribers the content in a more efficient way. I do believe that this trend is going to continue. Those who already have direct subscribers or customers will continue to look for ways to extend their services by offering content that can be delivered directly.

“Those who already have direct subscribers or customers will continue to look for ways to extend their services by offering content that can be delivered directly.”

MK: So that means in times where viewers are moving away from linear television and rather watch Netflix, for example, these companies have to make sure they are not falling behind?

TJ: Exactly, I think subscribers, or consumers in general, just demand they can consume everything, including content, anywhere, anytime, on any device and they don’t want to be confined to a television set or even cable. So for a company like AT&T that is already omnipresent is makes sense to buy someone that has that content.

MK: It looks like Sprint is next in line and expressed interest to acquire T-Mobile USA, a real cash cow for Telekom. What’s your take on the potential synergies in the telco industry?

TJ: Yes, the reports of Sprint looking into an acquisition, wether that is T-Mobile US or Charter Communications, is something we are seeing world wide at the moment. It looks like every major mobile network around the world is exploring their options. In France, for example, Orange just launched its own content division that is set out to produce originals and so in the face of a AT&T Time Warner merger there aren’t many options for a company like Sprint, they will have to carefully examine the market to determine if they want to expand their network buy buying another provider or, in the case of Charter Communications, buy a cable company that also has an amazing reach and market penetration in the US.

“It looks like every major mobile network around the world is exploring their options.”

MK: Talking about rights, what is so valuable for these large companies to own original programming?

TJ: There are two important factors here, one is the control you gain over the rights and their subsequent exploitation and the second aspect is the exclusivity that comes with ownership. That is a huge factor in acquiring new subscribers, which in turn is immensely important when you think about the future of the new company that is made up of one part delivering content and the other part creating the content.

MK: But how profitable can these companies really be or become? We are talking about an $80 billion dollar deal. You will have to work really hard to earn back that price tag.

TJ: Absolutely. The price tag is just amazing. On the other hand, and that is always the hope of course in a merger, the new company will have brand new synergies and efficiencies and will have it easier to earn back the purchase price. It’s very difficult to predict how the market will evolve but, as I mentioned, doing nothing is also not an option. Therefore, acquiring or extending the ownership of the value chain is essential and it can be, hopefully, be a great deal.

MK: Looking at Germany, are we about to witness a similar deal here as well? Media giants merging?

“So even through you have the Justice Department indicating that they are happy with the broad strokes of the deal there are factors that can delay a deal like that and ultimately make it unattractive.”

TJ: In Germany we have a fundamentally different media landscape with two different systems at work, public and private broadcasters, for example. Two of the biggest companies, ProSiebenSat.1 and RTL which part of Bertelsmann, are also constantly looking for acquisition options and in the digital space ProSiebenSat.1 is pulling ahead but RTL is not far behind. I think it’s not likely that one of the German or even Europan telco companies is going to buy a big content company. We also have a very different regulatory environment in Europe and in the AT&T Time Warner case its very handy that it is happening in the US. But even there you have a wildcard, which is the president, whom already said that he is not happy about it as one of the Time Warner news channels isn’t a fan of him and vice versa. So even through you have the Justice Department indicating that they are happy with the broad strokes of the deal there are factors that can delay a deal like that and ultimately make it unattractive.

MK: We will keep an eye on how it all unfolds. Tobias Jaeger of Axiom Venture Capital thank you so much for being here and thank you for watching. Until next time on Inside Wirtschaft.


The conversation was originally recorded on August 30, 2017.

About Manuel Koch

Manuel Koch from German business and consumer news network Inside Wirtschaft

Manuel Koch is a German TV Host, Stock Market Expert (New York Stock Exchange, German Stock Exchange Frankfurt), Media Coach, and CEO at Inside Wirtschaft. He produces content for his clients like Handelsblatt, Hapag-Lloyd or the Vienna Stock Exchange.

About Tobias Jaeger

Tobias Jaeger, Managing Partner of family office AXIOM Venture Capital

Tobias Jaeger is the CFO of London-based television production and content studio Colibri Studios. Tobias has lived, worked, visited, and studied in over 43 countries on 4 continents. Previously, he has held positions at Business Associates Europe, SAP AG, StrategosPoker, Aramark, and entrepreneur academy. Tobias is also a Managing Partner at media-focused SFO AXIOM Venture Capital.

Media CFO

Stories from the frontlines of finance, strategy, business affairs, and legal in the global media & entertainment industry.

Tobias Jaeger

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Entertainment investment banker turned CFO at Colibri Studios. Proud father and husband. Love all things media & entertainment industry, finance, and aviation.

Media CFO

Media CFO

Stories from the frontlines of finance, strategy, business affairs, and legal in the global media & entertainment industry.

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