Tara Lachapelle is a Bloomberg Gadfly columnist covering deals. She previously wrote an M&A column for Bloomberg News.

Comcast's interest in DreamWorks Animation is about more than just this one potential acquisition, which at roughly $3 billion would appear relatively tiny in comparison to Comcast's $150 billion market value.

The broader shift is that the industries now defined as telecommunications, cable television and entertainment are morphing into one, and there's a slow race in the U.S. to scoop up the best targets before they're gone. (We're accepting ideas for what to call this new industry hodgepodge.)

The lines have already blurred thanks to a few mega-mergers, including Comcast's acquisition of NBCUniversal, starting with a 51 percent stake in 2009 and then the rest for $16.7 billion in 2013 when General Electric was ready to exit the venture. Among other recent deals are AT&T's $67 billion takeover of DirecTV -- which brought together satellite-TV assets with a wireless service and high-speed Internet -- and Verizon's $4 billion acquisition of AOL to gain mobile advertising technology, a sort of back-end but important piece of this shift. It may even swallow beleaguered Yahoo next to build upon the AOL transaction.

Let's Make a Deal
Deals for media, entertainment and telecommunications companies within the U.S. are on the rise again
Source: Bloomberg
Data include M&A, major investments and joint ventures

Buying DreamWorks would give Comcast the chance to capitalize on the growth opportunity presented by the younger millennial audience, which consumes more entertainment but in different ways, requiring some innovation on the part of content providers. DreamWorks is the studio behind animated movie successes "Shrek," "Kung Fu Panda" and "How to Train Your Dragon." (Comcast owns Illumination, the maker of "Minions" and "Despicable Me.") DreamWorks also has a TV and home-video release strategy -- including providing family content for Netflix -- that has begun to pay off. The TV side helped the company beat fourth-quarter profit projections and turn around a slump in its stock price this year. DreamWorks CEO Jeffrey Katzenberg has called Netflix "our patron saint." 

But the lesser-known jewel within DreamWorks may be AwesomenessTV, a network for younger millennials featuring YouTube and Vine stars that may presage the future. Comcast's rival Verizon has already seen the value in it. Just this month, Verizon bought a 24.5 percent stake in AwesomenessTV, valuing the unit at $650 million. It fits with Verizon's new go90 free mobile-video service, which streams content geared toward teens. Is it valuable enough that Verizon, as it delves deeper into entertainment content, could mount a competing bid for DreamWorks? And don't forget, not long ago toy giant Hasbro thought about acquiring DreamWorks, too, before investors pushed back on the financial logic

A sale makes sense for DreamWorks. Its stock hasn't done much the past two years, emblematic of how smaller entertainment creators may be better off becoming part of larger, more diverse companies. They can package the distribution prowess with popular movies or shows and then tie a nice little bow around it. This kind of expansion could help lift the valuations of the distribution giants like Comcast that have long traded at a discount to their entertainment counterparts. Also, as the cable providers embrace "skinny bundles," some of the smaller companies could get left out in the cold.

Dream Sort of Works
Even with only a 5 percent return through April 26, DreamWorks has been one of the best-performing entertainment stocks this year. These businesses may be better positioned if bought by larger companies.
Source: Bloomberg

That's why DreamWorks surely won't be the last to get snapped up. The obvious candidates are Lions Gate, Starz, AMC Networks and maybe Discovery Communications. Bloomberg News reported earlier this year that Lions Gate was planning to restart talks to acquire Starz, in which it already has a stake. These companies have long been seen as "in play," especially after Rupert Murdoch's 21st Century Fox bid unsuccessfully for Time Warner in what would have been a huge entertainment merger in response to the wave of consolidation taking place on the distribution side -- AT&T's DirecTV purchase and Charter's $79 billion tie-up with Time Warner Cable, which won U.S. antitrust approval this week. 

The channels may be changing, but everyone will be watching. 

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Tara Lachapelle in New York at tlachapelle@bloomberg.net

To contact the editor responsible for this story:
Daniel Niemi at dniemi1@bloomberg.net