21st Century Fox may soon come under new ownership. Sources familiar with the situation tell CNBC on Monday that the media giant has been holding talks to sell most of itself to Disney.

Those familiar with the matter say the two sides aren’t talking at this very moment but given the on-again, off-again nature of their discussions, they could resume at any moment.

Senior management at Fox is under the impression that scale in media is of immediate importance and they don’t believe there is a path for rapid growth in entertainment through acquisitions. By selling off certain assets and narrowing its focus to news and sports content, management believes it would be better equipped to compete in the current marketplace.

As the publication correctly highlights, companies like Netflix, Amazon and even Facebook have changed the way people consume media and largely control digital distribution of video content. Simply put, there are many people that believe competing with this new guard requires scale that Disney has but Fox does not.

A deal of this type and magnitude makes a lot of sense for Disney, especially after revealing over the summer that it’ll be launching a video streaming service of its own in 2019. Said service will be the exclusive home to Disney and Pixar movies as well as flicks under the Marvel and Star Wars banner.

The summer announcement was viewed as a significant blow to Netflix whose content licensing deal with Disney expires in 2019. With a potential acquisition of Fox now in discussion, Disney should be taken even more seriously by the new guard.

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