AT&T is buying Time Warner. So who's next?

Now that AT&T (T) is buying Time Warner (TWX) in a $85 billion dollar cash-and-stock deal, the natural question is: Who’s next to be bought out?

Indeed, the media landscape continues to get smaller. Just this year, Verizon (VZ) announced it’s buying Yahoo, the parent company of Yahoo Finance, for $4.8 billion and Comcast’s NBCUniversal (CMCSA) division bought DreamWorks for $3.8 billion.

According to Porter Bibb, a managing partner at MediaTech Capital, the next big media deal will be between a traditional content provider and a phone or tech company.

Many content providers typically get their revenue from re-transmission rights from the cable industry and advertisers, but Bibb says in order to survive, they must find the right partner to push them into the digital arena, especially mobile.

“Google (GOOGL), Amazon (AMZN), and Microsoft (MSFT) all have faster distribution than cable can ever provide,”” Bibb tells me in the video above.

He says content providers including Discovery (DISCA), AMC Entertainment (AMC) and CBS (CBS) are all potential buyout targets.

Bibb believes media mogul Sumner Redstone, now Viacom’s (VIAB) chairman emeritus, and his daughter Shari will ultimately prevail in their attempts to re-couple with CBS, which Viacom split from in 2005. “Even though [CBS CEO] Les Moonves doesn’t want the burden of trying to resuscitate Viacom, I think he’ll be taken out of his misery very quickly.” That’s because Bibb believes the combined media giant will swiftly be snatched up.

He sees Google, Amazon, or Microsoft making a play for the combined CBS/Viacom.

“They get a major movie studio in Paramount, a major array of networks and the major sports contracts that CBS has, plus some of the digital side in CNET, which is an undervalued property,” Bibb ticked off.

As for Verizon’s planned buyout of Yahoo, Bibb believes the buyout will still happen, despite reports that Verizon would back out of the deal after Yahoo revealed that roughly 500 million email accounts had been hacked.

“There may be a haircut that Yahoo shareholders have to take because of the delay Yahoo took to announce the very serious hacking.”

He says AT&T and Verizon have polar opposite perspectives of how media should be distributed. “Verizon has placed a big bet on advertising, which is the core revenue stream for Yahoo and AOL, while AT&T has bought into the content side with Time Warner. It will be interesting to see who’s made the right choice,” he said.