While the burden is still on the government to prove its case against the $108 billion proposed deal between AT&T Inc. (T) and Time Warner Inc. (TWX), one team of analysts on the Street thinks that regardless of the outcome, the media space will see a period of heightened M&A activity.

Guggenheim’s Michael Morris reiterated a buy rating on shares of Time Warner, indicating that any pairing with another media giant such as the Walt Disney Co. (DIS), CBS Corp. (CBS) or 21st Century Fox Inc. (FOXA) would benefit the entertainment conglomerate. (See also: AT&T-Time Warner Deal Probably Dead, Options Trades Show.)

Tech Giants Drive Media Consolidation

Traditional media players have faced intensifying platform and content competition from the FAANG stocks, made up by Facebook Inc. (FB), Amazon.com Inc. (AMZN), Apple Inc. (AAPL), Netflix Inc. (NFLX) and Alphabet Inc. (GOOG). Even with uncertainty regarding the AT&T deal, the race for content should drive media companies to continue to seek out horizontal M&A in efforts to boost their market share, wrote Morris. As a result, even if AT&T is off the table, a deal should still go through, according to the Guggenheim analyst.

“We believe that media companies will be best positioned to serve consumers by offering content both directly and within bundled channel offerings. As such, we view some industry consolidation as beneficial to developing the necessary scale to build these models without compromising negotiating leverage relative to distribution partners,” wrote Morris.

The analyst also lowered his price target on TWX to $102 from $106, reflecting a 14.3% upside from Monday afternoon. Trading down 0.3% at $89.20, TWX has fallen about 7.6% year-to-date (YTD) versus the S&P 500’s 16.3% increase over the same period. (See also: Snap Signs $100M Content Deal With Time Warner.)

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