In industry after industry when traditional enterprises are faced with technological disruption they have landed on the same answer.
Scale itself is not everything. Unless the old companies learn from the platform business model, how to acquire them will not change their destiny.
For years, the non-tech sectors have looked with envy at the dominance of internet platforms like Facebook, Google and Amazon. These modern success stories benefit from network effects that enable them to operate at unprecedented scale, serving billions of users and generating billions in profits.
Tariffs, trade wars and rising nationalism may command headlines, but they have done nothing to dent global dealmaking.
North American companies unleashed a dealmaking spree totalling more than $50bn within one day, as executives ignored a pending trade war and uncertainty around US midterm elections to swallow European rivals in a series of industry-changing mergers.
Boardroom confidence, cheap debt and record stock prices have spurred a wave of activity that left global dealmaking at a record high of $3.2tn. Companies are racing to remake themselves by snatching trophy assets or consolidating with rivals before the business cycle turns.
Readied a multibillion dollar takeover offer for storied Milanese fashion house Versace — down to the grit of the mining world, with Canada’s Barrick Gold agreeing a $6bn all-stock purchase of Randgold Resources.
But the biggest prize was in media, as Comcast trounced 21st Century Fox and Walt Disney in a weekend auction for Sky with a ￡30.6bn bid, while in the radio sector SiriusXM secured a $3.5bn deal for digital music provider Pandora Media.
A rally in global stock indices has assuaged concerns that the intensifying trade dispute between the US and China would dent economic activity, and in turn dealmaking.
Partly, this reflects the end of a long cycle of easy money in which companies are looking to get that last bit of juice out of their stock prices. Some of the largest deals, such as AT&T-Time Warner, Disney-Fox, or CVS-Aetna, are about traditional companies trying to compete with the big internet groups by building scale. Either way, it is worth remembering that more than half of all mergers destroy shareholder value. Think of the cautionary cases of AOL-Time Warner, Quaker-Snapple or Daimler-Chrysler.