Late yesterday, Comcast made its $65 billion all-cash offer for key Twenty-First Century Fox assets official. The offer sets up a bidding war with Disney, which had already struck a cash and stock deal with Fox. My guess is that Comcast is going to end up prevailing and the bidding will actually be less heated than many expect. There are many dimensions to this drama, but here are 5 quick reactions I have.

Another big, but well-calibrated, swing from Comcast
Comcast loves to do big, bold deals: AT&T Broadband, NBCUniversal, DreamWorks Animation, now Fox. But while Comcast takes big swings, they’re always well-calibrated. Listening closely to the executive call yesterday afternoon and reviewing the slides, it’s clear an enormous amount of financial modeling went into this. Comcast will take on tens of billions of dollars of debt and increase its leverage. The Fox deal is a big swing, but not a reckless one; that’s not Comcast’s style.

DOJ’s AT&T-Time Warner blunder is a huge boon to Comcast
The Justice department’s decision to sue to block the AT&T-Time Warner deal, which it lost on Tuesday, cleared the path for Comcast to move forward. The DOJ’s suit was illogical and backward looking from the start.  But Comcast’s NBCUniversal ownership actually makes this new deal more “horizontal” and therefore regulatory challenged than AT&T-Time Warner was. But DOJ having lost AT&T-Time Warner will make it far more reluctant to take action to block Comcast-Fox. Talk about a gift to Comcast. Comcast’s CEO Brian Roberts should put DOJ’s antitrust head Makan Delrahim right at the top of his 2018 holiday card list.

Where does Hulu fit into all of this?
Perhaps the most surprising thing on yesterday’s call was hearing NBCUniversal head Steve Burke sing Hulu’s praises. Among other things, Burke said Hulu is a “Very important part of this deal, we would be very very interested in investing and growing that business in the future.” No question Hulu has built a strong SVOD franchise, but its most strategic priority is its Live skinny bundle service, which now has 800K subscribers. But Burke has been persistently skeptical of skinny bundles in the past due to their questionable profitability. Is Comcast/Burke warming to skinny bundles? I continue to believe Comcast would benefit significantly from controlling Hulu. It’s a hidden jewel in this big transaction.

The deal is internationally-focused, but where’s that leave Comcast’s domestic core business?
This deal is clearly about growing Comcast’s international exposure, but the company’s bread-and-butter will still be domestic cable TV. And more than ever, that business is under enormous pressure, not just because of cord-cutting but because national-scale competitors like AT&T, Dish and Google are using their skinny bundles to train consumers to pay far less for pay-TV. That leaves Comcast, which remains focused on expensive multichannel packages and the gold-plated X1 set-top box in an increasingly vulnerable position. Q1 saw an acceleration of video subscriber losses. Comcast needs to address this by offering lower priced packages and gaining national scale. Hulu Live helps, but in many ways the Fox bid is about maintaining the multichannel status quo.

Details are skimpy on how Comcast would better monetize Fox’s assets
For all of Comcast’s talk about how complementary the Fox assets are to Comcast, it took an analyst’s question to get Comcast’s executives to specifically say how the company would better monetize Fox’s assets (noteworthy because Comcast was effusive about how well Fox has been run). Their answer - taking Fox’s IP to theme parks and consumer product operations, more widely distributing Fox’s TV shows and movies internationally and becoming bigger in OTT distribution - felt somewhat vague. The complete absence of better ad monetization through scale and targeting (a key premise of AT&T-Time Warner and something at the top of all media companies’ agendas, wasn’t raised at all). If Comcast has a detailed plan for how to grow incremental revenue opportunities, it’s keeping it close to the vest.

For pure corporate drama, the Comcast-Disney-Fox drama is going to be a lot of fun to watch unfold. The reality is that Netflix, Amazon, YouTube and others are catalyzing huge changes in the video industry, which traditional players are trying to keep up with. How well they’ll do this is still totally up in the air.