| Thanks to The Byrds, we're all familiar with the biblical admonition that "to everything there is a season, and a time to every purpose under the heaven." Less well known is a version of the Solomonic verse songwriter Pete Seeger did not borrow for his classic "Turn! Turn! Turn!," which posits that there also is "a time to pluck up that which is planted." With AT&T's $85.4 billion bid to buy Time Warner (Fortune parent Time Inc.'s former owner), it is quite clear we are in the season of plucking. Like no time in recent memory, the strong are buying the less strong. This is true across the economy, but particularly in technology. Verizon is gobbling up a diminished Yahoo. Salesforce, a voracious buyer, made a run at Twitter. Facebook has pursued a portfolio-theory approach to acquisitions. Stalwarts like IBM, Oracle, and SAP are reliable bidders when software competitors reach critical mass. Intel, growth in its mainstay business stalled, has been gobbling up competitors. A rejuvenated Microsoft, not historically the most skilled acquirer, stepped up big to buy LinkedIn. Why now? Low interest rates make capital cheap. Technology leaders benefit from the two-pronged advantage of generous valuations and unprecedented piles of cash. Moreover, as David Gelles deftly notes in The New York Times, corporate leaders are confident in the economy as well as the status quo represented by a presumed Hillary Clinton presidency. The sky is the limit for what comes next. Apple reportedly kicked the tires at Time Warner, an indication the tech giant once averse to megadeals could be ready to put its massive balance sheet to work. (Dreamers drool for an Apple purchase of Netflix or Tesla—or both.) According to keeping-up-with-the-Joneses theory, Disney needs a deal, despite having already bought every creative enterprise in sight. Analyst Rich Greenfield of BTIG thinks Comcast, devourer of NBC Universal, now needs a wireless operator to match AT&T. "Can Comcast really resist buying T-Mobile?" he wrote over the weekend. Have a plucky week. |
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