A more relaxed regulatory environment that some in the M&E space were hopeful for under the Trump administration has not yet come to fruition. But dealmaking continues and the sector saw deal value rise in Q1 compared to the last two quarters to reach $11.59 billion, according to a recent US deals 2025 mid-year outlook from PwC.
And while volume was down, companies are still striking deals, though becoming more strategic and selective about which transactions they pursue, PwC’s Bart Spiegel told StreamTV Insider.
According to the report, strategic consolidation of streaming platforms remains a main source of deal activity in the M&E sector as companies seek efficiency that comes with scale and attempt to future-proof businesses for evolving consumer behavior and rising operational costs.
Tie-ups between streamers are likely to continue, with the rise of AVOD also serving as a catalyst for various transactions, although Spiegel anticipates companies pursuing a mix of both traditional M&A as well as other deal avenues as they try to figure out the most desirable combinations to play in a competitive and crowded market.
Relaxed regulation hasn’t shown up yet but dealmaking continues
“I think what people were expecting was a really robust deal market as the administration changed and it was more business friendly, but that regulatory environment that people were expecting never really materialized,” said Spiegel, PwC’s US Media Practice and Global Entertainment & Media Deals leader, while acknowledging headwinds such as talk around tariffs and economic uncertainty.
It's worth noting the FCC under Chairman Carr is pursuing a deregulatory effort to strip what are seen as outdated and inefficient rules (aptly headlined “Delete, Delete, Delete”) – which has spurred speculation for a wave of M&A as lifts of long-standing governance rules like TV ownership caps for local broadcast television are considered, although what ultimately plays out remains to be seen.
Still, some have already started to position as they anticipate rollbacks of certain rules.
For example, on Monday TV station owners Gray Media and E.W. Scripps announced an agreement to swap TV stations across five mid-sized and small markets that would result in the creation of new duopolies for each group. As the swap is for an exchange of comparable assets, neither company will pay a cash consideration to the other. The companies expect to close both sides of the swap in Q4 but require regulatory approvals. As noted in the deal announcement, “the regulatory approvals will require certain waivers of outdated local ownership restrictions” they contend have hindered local broadcasters’ ability to compete in today’s competitive media environment.
“The parties intend to work closely with regulators, employees and other stakeholders to obtain the requisite approvals and to facilitate the smooth transitions of these stations to new ownership,” the announcement stated.
On the other hand, the saga of Paramount and legal troubles with President Trump over editing of a 60 Minutes interview with former U.S. Vice President Kamala Harris on CBS continued to play out in the beginning of 2025 as the media company also tries to gain government approval for its $8 billion merger with Skydance Media. The legal drama culminated last week when Paramount agreed to pay $16 million to Trump and his future presidential library to settle his lawsuit against the media company. The situation could illustrate some level of uncertainty around that anticipated “business friendly” stance from the government in the M&E space, but as there are specific circumstances and dynamics involved, it isn’t necessarily indicative of how the government will impact dealmaking at large.
Paramount aside, in the current environment, deals are still getting done and there’s opportunity to be had.
“If you’re one of the players in the industry, you want to make sure that you’re staying ahead of the curve” to build up platforms that are best-in-class with the right technology, infrastructure, and bolt-on support, PwC’s Spiegel noted. “So you still need to make moves and there’s still opportunities in the market but what we saw is that you just need to be more tactical.”
And making moves they are.
PwC’s media and telecommunications US deals 2025 midyear outlook, based on S&P Global Market Intelligence, concluded that deal activity in the sectors “showed remarkable resilience throughout the first half of 2025.”
Media and Entertainment (M&E) in particular saw deal value climb in Q1 compared to the prior two quarters, reaching $11.59 billion. As for volume, M&E dealmaking specifically held steady, with a total of 119 deals in the first quarter of 2025. Note, the $34.5 billion Charter-Cox deal, announced May 16, is not included in PwC’s December-May 15 outlook.
As you can see, while volume is down, deal value is up - “so when people are finding deals to do, they’re just being more tactical and strategic when they go about doing that,” Spiegel explained.
Despite some macroeconomic headwinds, what he’s been seeing among clients and other media companies is that they’re still seeking the best infrastructure and other elements for platforms to ensure “they’re not sitting on the sidelines because they want to have a first mover advantage if something comes to play.”
So what are some of the key trends driving deal activity for the M&E sector – and streaming in particular – so far in 2025 and as we look ahead?
Read on for more from the conversation with PwC’s Spiegel.
Entering streaming’s third chapter
In Spiegel’s view, streaming is entering its third chapter.
The first chapter was growing subscriber bases at all costs, including promotions and giveaway periods, alongside heavy content investments. Streaming’s second chapter turned to financial metrics and efforts to achieve profitability from DTC operations and reduce churn. Now he believes we’re in or nearing chapter three, where a few so-called winners have emerged (without naming names).
“There are some platforms that are winning, and there are some that are positioning themselves for scale and opportunities in the future to compete in the market,” Spiegel commented.
One reason being consumers don’t want to pay for six to nine streaming services.
This factor also ties into another key theme he expects to impact dealmaking - advertising.
Everything AVOD
For TV and streaming, Spiegel noted a “huge ramp up in everything AVOD.”
He anticipates the rise of ad-supported media and entertainment experiences – not only for streaming but other mediums and content platforms like mobile gaming - will be a significant trend going forward.
Spiegel expects “all things advertising” - meaning anything using ads as a source of revenue - to be a hot industry in the deal space, not only for the next six months but the “next four or five years.”
The notion of the rise in AVOD and ad-supported video (can’t forget those linear FAST channels and SVOD services with ad tiers) helping to drive future dealmaking and strategies for the M&E sector intertwines with a few different aspects, including tightening of consumer wallets amid macroeconomic challenges and general subscription fatigue, among others.
For consumers that aren’t willing or able to shell out for higher priced ad-free tiers, less expensive or free ad-supported options can be attractive. In Spiegel’s view, the longer there are macroeconomic factors impacting consumer budgets, the more they rely on and become amenable to offloading some of that streaming cost burden through watching ads.
Data from firm Antenna earlier this year shows traction already, estimating there are 100 million subscriptions in the US to ads plans for premium SVODs (excluding Amazon’s Prime Video, which counts a large base of auto-converted ad plan users), and ad tiers now make up 46% of all subscriptions for services that offer them.
To Spiegel, “advertising for the foreseeable future is going to be extremely important just given where we are from a macroeconomic standpoint” and the fact that ad-supported tiers been proven to bring new people into the ecosystem by helping to manage the cost for consumers, while not appearing to cannibalize other audiences for the platforms.
The monetization aspect of those audiences by bringing advertiser budgets into the fold beyond subscription revenue is another component. And one where having a scaled streaming platform is not only an efficiency play but also important for reach that ad buyers demand – coming back to consolidation, in part, for scale as a trend underpinning future dealmaking for streamers.
With all eyes on advertising, Spiegel said advertisers and agencies themselves will need to ensure their solutions and work with platforms don’t ruin the viewing experience and turn consumers off to a service with ads - particularly as churn remains top of mind for the streaming industry.
The advertising industry saw its own major deal announced last December with the pending $13.5 billion acquisition of media buying agency Interpublic Group by rival Omnicom, a combination which secured a greenlight from the U.S. Federal Trade Commission in June.
Finding the right dance partner
In a world where consumer time and attention, as well as wallets, are finite, many streaming platforms would like to be a one-stop-shop for viewers (Prime Video, as one example, has stated the aim before). But not everyone can do it alone and PwC expects to see continued tie-ups and media consolidation in one form or another – but it’s all about finding the right combinations.
A few factors contributing to streaming consolidation are the wide breadth of options currently available, consumer limits on the number of subscription services they’re willing or able to pony up for, and the need for scale alongside a comprehensive offering.
With a long tail of streaming services available, Spiegel said PwC research and other studies have found “three to five is the magic number of services that people will pay for.”’
Meaning companies need to figure out where they sit – and scoop up or partner up with others, both to get scale and to compete effectively as one of those 3-5 “must-have” entertainment options.
For those in the market, the expert said they should contemplate “am I one of the ones that is a ‘must have’ or am I on the periphery where it makes sense to form partnerships, joint ventures, other agreements” that enable a scaled go-to-market with a compelling offering at a nice price point and varied content selection.
In one example of a consolidation move this year, Roku in May announced the acquisition of budget-friendly virtual MVPD Frndly TV for $185 million.
Others, meanwhile, have taken steps that in addition to financial incentives could position them to make different partner or combination decisions.
The first half of 2025 year saw two major media companies, Comcast’s NBCUniversal and Warner Bros. Discovery, split up their respective businesses, including plans to spin out traditional linear networks and other assets into standalone publicly traded entities (Comcast’s named Versant) with certain streaming efforts housed separately.
For some, tax benefits and balance sheets are part of the picture. But looking ahead, once spin outs are done, companies want to let those management teams figure out down the road “who they want to choose as their dance partner,” Spiegel told StreamTV.
Moves like this are also a nod to the idea that streaming companies are contemplating where they sit currently and where they want to be 2-3 years from now, he added.
In some cases that could mean seeking multiple so-called dance partners or pooling resources to create expensive, high-quality content.
(Check out a separate take on WBD’s business split from Needham analyst Laura Martin in a video interview with David Bloom at the StreamTV Show, here.)
Speaking generally about companies spinning out parts of their business, like linear networks from streaming, PwC’s Spiegel cited the potential to offload risk that comes with content investment.
Dispersing capital investment across different content genres can make a difference, according to the M&E deals leader, because it allows for diversification - and as history has shown, even with compelling stories and big stars and budgets, hits aren’t always guaranteed when it comes to content.
And once money is spent on content, there’s the need for it to reach a wide enough audience – not something all platforms can do on their own.
“I think everybody realizes that you need to have scale to win,” Spiegel said.
To get scale of compelling or expensive content, deals – be they partnerships, JVs, or traditional M&A - will be needed at some point for certain players, he said, “so that [platforms] can compete in the market and be one of those three to five platforms that are must haves.”
A mix of deal types expected
As for whether likely continued consolidation in the streaming market will emerge via straight M&A or other avenues like strategic partnerships and JVs, PwC’s Spiegel expects to see a mix of both.
Ultimately, he said, it depends on how creative the management team want to be and what opportunities are in the market that can maximize shareholder value. For companies spinning out and pivoting certain operations to standalone, he thinks it will “lend itself more towards the M&A angle.”
But for those that really want the scale to compete, Spiegel also believes “you’re going to also need to be creative about how you to go to market on some of these other things,” like partnerships and how capital is invested, including content.
Some creativity in how media companies are striking agreements and investing in programming as they evolve in the streaming era could be seen with Disney’s recent disclosure that it took a minority stake in the Premiere Lacrosse League alongside a renewed five-year media rights deal. As Axios wrote, “a strategic investment in PLL gives ESPN more incentive to work with the league on effective distribution.”
Disney was also involved in a streaming transaction at the beginning of the year, when it reached an agreement to acquire a 70% ownership stake in virtual MVPD Fubo and combine the business with that of its competing vMVPD Hulu + Live TV (although so far plans are to keep operating them separately). Related to the deal, Fubo agreed to receive a $220 million cash settlement infusion that ended the vMVPD’s antitrust litigation against Disney and partners of the defunct Venu Sports JV.
As the media landscape evolves, without commenting on specific companies Spiegel suggested nearly all streaming platforms could be in play for combinations.
“I think you have one or two platforms that are pretty comfortable with their strategic positioning, and I think all the others are open to finding dance partners,” he noted.
Deals for back-office, infrastructure don’t grab headlines but drive volume
PwC’s midyear deal outlook noted that while value was up, all transactions announced in Q1 were less than $10 billion – which mainly means no mega-mega deals in the timeframe.
As mentioned, deals are still happening, but as the report suggests, many aren’t so much of the headline-grabbing variety.
That includes deals for back-office needs and infrastructure, as well as platforms beefing up their own data, analytics and advertising capabilities.
“Especially given the pace of technological change, there are a lot of transactions happening that really support your back office, your infrastructure, your capabilities,” Spiegel commented.
While these types of transactions might not make the front page, he affirmed those for back-office and infrastructure help drive deal volume for the sector and said they help make a player in the M&E space a more efficient, valued company in the market while also impacting key financial metrics like ROI.
“Where everybody’s measuring you against your return on invested capital, now you’re actually seeing some returns, so I think you’re going to continue to see” those kinds of deals for back-office infrastructure happen.
Along the same lines and coming back to advertising as a deal driver, he noted streaming companies are building up their own capabilities to deliver more value. According to Spiegel, platforms are always looking to improve the functionality of their own data and ad capabilities because it allows them to more fully monetize and command higher CPMs, particularly when platforms show they can directly reach or target specific cohorts efficiently and maximize advertiser ROI.
“I always think that that technology, those capabilities will be highlighted from an M&A perspective, and we see that,” he said.
Bullish on video games
Spiegel is also “bullish on video games” – where advertising, again, also potentially comes into the mix.
Streamers wanting to be a one-stop-shop have been looking to incorporate games in various forms, from gamified ad breaks and mobile games, including those based on content IP, to the potential for interactive casual family or co-op couch game play (as Netflix called out in January).
Next May the delayed release of the latest Grand Theft Auto VI videogame is poised to debut, which, if successful, could serve as an inflection point and heighten excitement and renewed attention on video games
In general, the Spiegel believes streaming platforms – if they haven’t already – will be looking to assess their gaming strategy as we move into 2026.
Threading the AI needle
And fear not, AI is not to be left out of the dealmaking equation.
Spiegel acknowledged AI is “impacting everything” – from advertising and search to content creation and operational efficiencies – adding “further integration of AI is going to be forefront.”
Everyone might be looking at AI, but the expert described how there are different camps and considerations to weigh: On one hand, many see AI benefits in the form of operational efficiencies, cost savings and speed to market, while others, including in the creative space, may want certain limitations or emphasize a more cautious and deliberate use of AI while also trying to avoid potential conflicts with core beliefs.
To Spiegel, it becomes a sometimes-tricky question of finding balance.
“It's kind of threading that needle, but also threading that needle without being left behind,” he commented.