Netflix is currently leading the pack as a potential new owner of Warner Bros., but the battle for control of the iconic studio is far from over. Paramount Skydance has stepped in with a significant offer that could bolster CEO David Ellison’s influence over the entertainment landscape. Warner Bros. Discovery has consistently rejected previous offers from Paramount Skydance, yet Netflix’s bid might face its own hurdles due to regulatory scrutiny from the Federal Trade Commission and the Department of Justice. As much as WBD’s chief David Zaslav and Netflix co-CEOs Ted Sarandos and Greg Peters might wish this deal were finalized, the reality remains that several outcomes are still on the table. No matter which party ends up acquiring Warner Bros., the ramifications of such a massive merger would send ripples through the entertainment industry. While corporate consolidation may satisfy shareholders, it’s likely to decrease consumer choices and leave many industry workers struggling.
WBD has indicated some openness to Netflix’s $82.7 billion takeover proposal, which would involve a combination of cash and stock options. This deal would take place after WBD splits into two separate entities. The proposed amount exceeds the offer Comcast made for Warner Bros. (excluding Discovery Global’s assets), prompting NBCUniversal to withdraw from the bidding. However, earlier this week, Ellison deemed Netflix’s proposal “inferior” and claimed that Paramount Skydance could better serve WBD stakeholders by enabling them to maximize the value of their shares.
Paramount Skydance is now proposing a $108.4 billion cash offer in hopes of persuading WBD to agree to a full sale. This would grant Paramount Skydance control over Warner Bros.’ film and TV production studios, the HBO/HBO Max brands, and, unlike Netflix’s proposal, all of WBD’s cable networks like the Discovery Channel and TNT. This move would position Ellison, who recently took on the CEO role after Skydance’s acquisition of Paramount for $8 billion, as one of the most powerful figures in media.
While many expressed concern over Netflix acquiring Warner Bros., a win for Ellison would also raise significant alarms. The loss of a legacy studio to a streaming service—albeit one under a traditional studio’s umbrella—would indicate that historical content is being absorbed into a larger corporate entity. This could benefit Paramount Plus by allowing them to feature HBO series in a manner similar to how it currently promotes IP acquired from Showtime. Additionally, Ellison owning CNN—another WBD property—could also be seen as a win for him. But the troubles CBS News faced, following high-profile resignations linked to a lawsuit settlement with the Trump administration, provide a stark warning of the potential fallout.
Reports from the Wall Street Journal reveal that Ellison has assured the White House of plans to reform CNN just as he did CBS, indicating sweeping changes for the cable news network if he acquires WBD. While neither Paramount nor the White House has elaborated on what the new CNN might entail, it’s easy to speculate that Ellison could push for more favorable coverage of the Trump administration.
Amidst the turbulence surrounding Paramount Skydance’s latest hostile bid, the source of Ellison’s seemingly vast reservoir of cash was somewhat overshadowed. A portion of this funding is expected to come from Ellison’s family, particularly his father, Larry, co-founder of Oracle. However, a significant part of the funding for the WBD bid originates from Jared Kushner’s Affinity Partners private equity firm and sovereign wealth funds from Saudi Arabia, Abu Dhabi, and Qatar. This involvement raises concerns over conflicts of interest, especially considering the bid needs approval from the Trump administration. Larry Ellison’s past associations with Trump have also added to the unease surrounding the proposal.
A merger between Netflix and Warner Bros. would introduce its own set of significant challenges. Should Netflix prevail, competition in the streaming market would diminish further, likely giving the company more power to raise subscription prices. Although Netflix may not share Paramount Skydance’s ambition to disrupt the cable media landscape, it does view this acquisition as a chance to shift how the entertainment sector operates. Upon announcing its bid victory, Sarandos informed investors that Warner Bros. projects would still hit theaters but might see shorter release windows to be more “consumer-friendly.” This approach could notably impact theater owners, whose profits depend heavily on the films available for screening.
Merging with Warner Bros. would also grant Netflix excessive leverage over industry professionals—actors, writers, directors, and more—who would have fewer production options. This could complicate workers’ efforts to negotiate for better pay and protections, especially during upcoming union negotiations. Furthermore, it’s likely that a combined Netflix and WB would produce fewer films compared to their current separate operations.
In a statement, SAG-AFTRA emphasized that it only supports deals that lead to “more creation and more production, not less.” Similarly, a representative from the WGA told Vulture that the main concern lies in the “acquisition and pending consolidation of two media giants, not who the buyer is.”
While these issues are substantial, they are not exclusive to either Netflix or Paramount Skydance. Regardless of who emerges victorious, the inevitability of layoffs and price increases underscores that the fallout from this merger will likely be dire for the industry.
