Closely followed value investor Mario Gabelli told CNBC on Friday that likely changes at the Federal Communications Commission by the Trump administration may spur big mergers in media companies.
"The free-market system should allow CEOs to go in and make their bets," the billionaire chairman and CEO of Gamco Investors said on "Squawk Box." Gamco has nearly $40 billion in assets under management.
Despite vows by then-candidate Donald Trump to block AT&T's planned $85 billion buyout of Time Warner, Gabelli also raised his probability for the deal from about 40 percent to 70 percent.
Looking ahead to what other media giants may do to compete should the deal go through, Gabelli, a big investor in the sector, said Disney would look to buy Netflix, and Apple may pursue buying both. Disney, Netflix, and Apple did not respond to CNBC's request for comment.
The next step, Gabelli said, is for media conglomerates to be able to own and distribute content as well as increase connectivity on a global scale.
"There's a lot that will go on in the next six months," Gabelli said. "Consolidation is going to occur. But don't look at the U.S. consumer. We're only 330 million people. We've got 7 billion more that have mobile phones, smartphones and they want content."
Addressing speculation surrounding another possible deal, Gabelli said he sees Viacom purchasing CBS and helping the network establish its global footprint, with CBS CEO Les Moonves at the helm.
Shari Redstone, vice chairwoman at CBS and Viacom, said Thursday it would make sense for the companies to explore a merger, but did not confirm that they would.
— Disclosure: According to its June 13F filing, Gabelli Funds has positions in all of the stocks in this article, except Netflix.