Comcast Corp has offered $US65 billion ($A86 billion) for Twenty-First Century Fox Inc's media assets, emboldened by AT&T Inc prevailing over the Trump administration's attempt to block a merger with Time Warner.
The all-cash offer on Wednesday for Fox's movie and TV studios and other assets including the X-Men franchise, opens a war with Walt Disney Co, which has bid $US52 billion in stock.
Comcast is expected to lead a wave of traditional media companies trying to combine distribution and production to compete with Netflix and Alphabet's Google. The younger firms produce content, sell it online directly to consumers and often offer lucrative targeted advertising.
AT&T won a court victory over sceptical US antitrust regulators on Tuesday when a federal judge allowed it to buy Time Warner for $US85 billion, which was widely taken as a green light for Comcast to submit its expected bid.
Comcast may face more difficulty than AT&T and other would-be acquirers, though, since Comcast already has its own TV and movie studios in the NBC Universal division, a content overlap AT&T-Time Warner lacked.
Justice Department lawyers who tried to stop AT&T's $US85 billion deal expect consumers will lose out as bigger companies raise prices, and some lawyers saw that as a concern in a Comcast-Fox deal which would put two movie studios and two major television brands under one roof.
"One cannot ignore the fact that there's less independent content to go around," after the AT&T deal, said Henry Su, an antitrust expert with Constantine Cannon LLP.
Still, the AT&T court fight gave Comcast valuable information about how to structure a Fox deal, said David Scharf, a litigation expert with Morrison Cohen.
"Any deal that's coming down the pike that's not baked yet knows the government's playbook. They know what the government is concerned about," he said. "They can learn how to structure a deal to make it more palatable."
Disney itself has "surgically" structured a transaction that "might be doable", avoiding Fox Broadcasting and big Fox sports channels, US antitrust chief Makan Delrahim said last week.
Comcast may have a tough time winning over Fox's largest shareholder, Rupert Murdoch's family. They own a 17 per cent stake and would face a multibillion-dollar capital gains tax bill if he accepted an all-cash offer from Comcast, tax experts have told Reuters.
Craig Moffett, an analyst with MoffettNathanson, said in a research note that Disney could prevail for other reasons.
"Disney has the superior balance sheet, cost of debt, equity and rationale to emerge victorious over Comcast in a bidding war," Moffett said.
