Sony and AT&T negotiation for Crunchyroll acquisition

Case study

Written by:
Catalina Granada

Presented to:
Professor Stephan Langdon

International Negotiation

Universidad de La Sabana

2023-1
Table of content
Introduction.......................................................................................................................................3
Literature review................................................................................................................................3
Companies.........................................................................................................................................4
AT&T:.............................................................................................................................................4
Sony:..............................................................................................................................................5
The purchase:.................................................................................................................................6
Conclusion..........................................................................................................................................7
Bibliography.......................................................................................................................................7
 Introduction
After a hard time, due to the pandemic, AT&T Warner Media was looking to cut off the
accumulated debt, and Crunchyroll, an innovative streaming platform for anime content was the
perfect asset to continue the task. Between all the potential buyers Sony Pictures Entertainment (a
subsidiary of Tokyo-based Sony Corporation) and partial owner of Funimation (the main
competence for Crunchyroll) seemed to be the perfect objective, achieving the higher price was
the challenge. This paper will analyze how AT&T applied a Distributive strategy on the negotiation
with Sony and which tactics they might used to get the best deal.

Literature review
According to Menkel-Meadow (2022) distributive framework has the goal of maximizing
individual gain in a “win/lose” situation where competence and persuasion are vital in the
negotiation. When applying this model some steps must be considered. First, making the first offer
or being prepared to respond to it with a counter offer, then bargaining and concessions come, as
well as many tactics that pretend to persuade the adversarial party in order to get the BATNA,
however in this type of negotiation finding ZOPA is crucial to reach an agreement.

Distributive model differs from Integrative model by the fact that relation between parties
is not relevant in the first one, parties have actually different desires from the possible agreement
outcome. Cooperation and flexibility will depend on whether it is a zero-sum situation or not, that
means whether one party victory means defeat or loss to the other one. In a selling situation
buyer will expect to get the lowest price while seller will try to set the higher price possible, if the
agreement point is closer to the seller’s target point, then he is the one winning the best deal
while the buyer is having a loss on his expectations. (‌Allen & Burrel, 2015)

Talking about distributive bargain tactics, the anchoring one is commonly used, where
parties tend to negotiate from a number they anchor in a certain moment of the process, for
example the first offer. Let’s remember that information should not be completely exposed in this
kind of model, therefore the offers we make will be information the opponent can use to suppose
our position and reservation point. (Maaravi, Y, et al. 2014) Depending on the offer that has been
anchored it could turn out in a great deal or even a drawback, Maaravi, Y et al. (2014) mentioned
that buyers have usually an advantage with this tactic as they are always expected to make the
first offer, but buyers can use it too to reach lower price levels.

Another perspective of this situation is that aggressive development on bargain tactics

such as the one mentioned before can maximize economic gain but impact in the relation with the
other party in a very negative way. Even though that is not at stake on the negotiation is not a
favorable scenario in business. For that reason, Schaerer, M et al. (2019) state “that make a first
offer and shift their counterpart’s attention to their reservation price” can assure a higher
satisfaction on the opponent and therefore having as a result a “win-win” outcome.

Companies

AT&T:

Sony:

The Final price:

Conclusion

Bibliography
Schaerer, M., Schweinsberg, M., Thornley, N., & Swaab, R. (2019). Win-win in distributive

negotiations: The economic and relational benefits of strategic offer framing.

https://core.ac.uk/download/pdf/275589702.pdf

A
‌ llen, M., & Burrel, N. (2015). Distributive Negotiation Strategies. The International Encyclopedia

of Interpersonal Communication, 1–9 | 10.1002/9781118540190.wbeic153. https://sci-

hub.ru/https://doi.org/10.1002/9781118540190.wbeic153

Trötschel, R., Bündgens, S., Hüffmeier, J., & Loschelder, D. (2013). Promoting prevention success at

the bargaining table: Regulatory focus in distributive negotiations. Journal of Economic

Psychology, Volume 38, Pages 26-39,.

https://sci-hub.ru/https://doi.org/10.1016/j.joep.2012.03.006

Maaravi, Y., Pazy, A., & Ganzach, Y. (2014). Winning a battle but losing the war: On the drawbacks

of using the anchoring tactic in distributive negotiations. Judgment and Decision

Making, 9(6), 548–557. https://doi.org/10.1017/s1930297500006410

Menkel-Meadow, C. (2022). Negotiation: a Very Short Introduction. Oxford University Press. 12-56.