THERE’S SOMETHING AMUSING ABOUT WALT DISNEY AND GENERAL ELECTRIC complaining to the FCC that America Online and Time Warner are too big to merge. You might call it a case of two oligopolists calling two other oligopolists a monopolist.
It should be noted that two other big boys in the telecommunications/entertainment business, Viacom and News Corp., didn’t join in the objections. Indeed, there’s a lot of thinking that desperation, not domination, is the key motivating factor for the TW-AOL marriage.
Certainly the stock market hasn’t been behaving as though the merger,which according to conventional wisdom will be approved by regulators,is going to create an indomitable media powerhouse: Since the deal was announced in early January, the stocks of Disney and GE are up a little, and the stocks of Viacom and News Corp. are up a lot, while the stocks of TW and AOL are down about 15% and 25%, respectively.
Right now, all of these media giants look mighty scary, but conglomerate behemoths have a knack for eventually turning into corporate dinosaurs.
