Comcast is following a franchise-focused strategy
Comcast (CMCSA) is aiming to develop new franchises that can be monetized effectively across all of its business segments. Late in April this year, Comcast took a step in that direction with its acquisition of DreamWorks Animation (DWA) for $3.8 billion. Comcast expects to close the acquisition by the end of this year.
Comcast stated at the Guggenheim Securities TMT Symposium in New York this month that the company intends to build a strong consumer products business by acquiring new franchises. The company also stated that until about 5.5 years back, the company didn’t have a consumer products business at NBCUniversal. The company, at first, had only the Fast & Furious franchise, which has gone up to eight franchises.
The company also cited the example of Walt Disney (DIS), which has vast intellectual property (or IP), and it’s this IP that makes Disney’s filmed entertainment business and its brand management stand out in the media industry. Creating new franchises would give Comcast a competitive advantage over its competitors like Disney in the media industry.
Disney’s franchise-focused strategy
Disney uses a franchise-focused strategy that will enable it to monetize its IP (intellectual property) across its segments for a long time. The company’s 11 franchises have had retail sales of more than $1 billion in the last two years. Disney is undertaking many strategic initiatives to boost the presence of its brands across multiple platforms and to expand the reach of its brands.