Survival of the Biggest: Europe’s TV Shake-Up Is “Inevitable”

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Over the past week, two significant television transactions have occurred – ITV Studios purchasing a controlling interest in Moonage Pictures, producers of The Gentlemen, and MediaForEurope’s attempt to acquire Pro7Sat.1, a German broadcaster. These events underscore a harsh reality for Europe’s traditional networks: It’s either grow or perish.

In an effort to stay competitive amidst the surge of global streaming services, Europe’s long-standing TV titans are racing to expand their influence. These giants are threatening their market share and eroding their financial profits. Once invincible regional leaders now find themselves at risk.

Last year, Pro7Sat.1, headquartered in Munich, reported operating profits exceeding $600 million (approximately €557 million), and saw a slight increase in total revenues to over $4.2 billion (around €3.9 billion). However, for the third consecutive year, television advertising revenue decreased by approximately 5 percent, reaching $1.6 billion (about €1.47 billion). Given these financial circumstances, it’s not surprising that MediaForEurope (MFE), the European broadcasting conglomerate owned primarily by Italy’s Berlusconi family, proposed a takeover bid for the remaining 70 percent of Pro7Sat.1 they don’t already own. This offer, valuing the broadcaster at around $1.4 billion (approximately €1.3 billion), is the lowest possible price permitted by German law.

According to François Godard, a market analyst from Enders Analysis in London, the bid may not initially be successful because MFE would rather wait for Pro7 to sell off some of its non-essential assets, such as e-commerce and online dating ventures. However, he predicts that MFE will eventually gain control over Pro7, as consolidation at the European level is an inevitability.

According to Pier Silvio Berlusconi, CEO of MediaForEurope (MFE), their strategic plan involves purchasing television networks throughout Europe. This move aims to capitalize on economies of scale within the advertising market. By growing large enough, they intend to challenge Netflix, Amazon, and YouTube for advertising revenues in Europe.

Media Company Firm (MFE) currently owns Mediaset, Italy’s leading television broadcaster, and Telecinco, Spain’s top commercial network. If MFE acquires Pro7, it would rank as the third largest commercial TV company in Europe, trailing behind RTL (owned by the media conglomerate Bertelsmann from Germany) and ITV of the United Kingdom.

Based on news outlets’ accounts, Media Fortuna Enterprises (MFE) has submitted a proposal for TVN, the free-to-air broadcaster in Poland that Warner Bros. Discovery is attempting to sell. Reuters states that MFE has lined up €3.4 billion euros ($3.6 billion) in funding for its growth initiatives, and it’s speculated that TV properties in Portugal and the Netherlands are part of their targeted acquisitions as well.

Since 2019, I’ve been all about this cross-border strategy, thinking that consolidation efforts in a single country, specifically merging the top commercial networks within a specific territory, would face resistance from national regulatory bodies. RTL attempted this approach not once, but twice last year. They proposed a $4 billion merger between their French network M6 and market leader TF1, as well as a similar deal in the Netherlands that aimed to link up RTL Nederland with Talpa Networks, the TV group masterminded by TV tycoon John de Mol, creator of ‘The Voice.’ Unfortunately for them, both proposals were thwarted by antitrust authorities.

In a unique approach, RTL and ITV are channeling their earnings from traditional free TV, which despite a gradual decrease in popularity, remains profitable, into expanding their own streaming platforms (RTL+ and ITVX) and content production businesses. ITV has recently added Moonage Pictures to its list of acquisitions, following a series of purchases that also included Hartswood Films (known for producing Sherlock), Eagle Eye Drama (creators of Professor T.), and Nicola Shindler’s Quay Street Productions.

Via its production arm Fremantle, RTL has been on a buying spree, acquiring prominent independent production companies such as Ireland’s Element Pictures (known for “Poor Things” and “Normal People”), Italian group Lux Vide (“Devils”), and U.K.-based Dancing Ledge Productions (“The Responder”). Despite delaying its initial goal of reaching €3 billion ($3.24 billion) in annual revenue for Fremantle by the end of this year (it was €2.25 billion last year), RTL remains committed to growing rapidly and achieving sizeable growth.

Reports suggest that ITV is holding preliminary discussions with RedBird IMI, an investment group backed by Abu Dhabi, regarding the potential merger of ITV Studios with All3Media, a production company owned by RedBird and known for creating popular series like “Traitors.” Such a deal would result in a massive $4 billion production giant. Additionally, there are rumors that Fremantle might put forth a bid for ITV Studios independently.

During ITV’s earnings call on March 6, CEO Carolyn McCall refrained from addressing merger rumors but emphasized a consensus viewpoint within the industry: The trend of further consolidations is imminent.

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2025-04-02 20:25