Battle for Warner Bros. Discovery: Netflix vs. Paramount Skydance
Two competing proposals to acquire assets of Warner Bros. Discovery (WBD) are under regulatory review in the United States and Europe. Netflix has reached an agreement to acquire WBD's studio and streaming operations for approximately $72 billion, while Paramount Skydance Corp. has made a separate bid to acquire the entire company for approximately $110 billion. Both transactions are subject to approval from competition regulators and shareholders.
Details of the Bids
Netflix Proposal
Netflix has announced an agreement to acquire Warner Bros.' television and motion picture divisions, HBO Max, and DC Studios. The deal is valued at $27.75 per Warner share, representing a total enterprise value of approximately $82.7 billion. According to company statements, the acquisition does not include CNN, Discovery, or other cable networks.
The proposal would integrate WBD's content library—including intellectual property such as Harry Potter, Looney Tunes, and Friends, as well as HBO series including Succession and Game of Thrones—with Netflix's existing operations. Netflix's co-CEOs have stated the company intends to continue theatrical releases for Warner films, honor existing contractual agreements, and operate Warner studios independently. Completion of the transaction is projected within 12 to 18 months, pending WBD's separation of its cable operations.
Paramount Skydance Proposal
Paramount Skydance Corp., led by David Ellison, has submitted a bid to acquire all of Warner Bros. Discovery for approximately $110 billion. The company is considering divesting some children's television network assets to facilitate European Union approval, according to people familiar with the matter. Paramount has not yet decided whether to submit formal remedies to regulators.
David Ellison has publicly stated that if Paramount Skydance acquires WBD, the combined entity would produce at least 30 feature films annually, all intended for theatrical release. He has argued that a Netflix merger would reduce market choice and potentially create a dominant entity.
"A Netflix merger would reduce market choice and potentially create a dominant entity." — David Ellison
The merger would unite Paramount's Nickelodeon and WBD's Cartoon Network, two children's TV brands. According to Bloomberg Intelligence analyst Jennifer Rie, the European Commission is likely to scrutinize overlaps in the wholesale supply of children's television channels, particularly if combined market shares exceed 40% in any country.
Regulatory Review
European Union
The European Union's regulatory offices are conducting "pre-notification discussions" regarding potential acquisitions of WBD by either Netflix or Paramount Skydance. A formal antitrust probe by Brussels is anticipated once a deal is finalized in the United States.
Key regulatory issues for the EU include:
- The effect on European consumers
- Jobs within production and theatrical exhibition sectors
- Potential impacts on subscription costs
The International Union of Cinemas (UNIC), representing theater operators across Europe, met with the EU's Directorate-General for Competition, emphasizing protection of theatrical release windows. UNIC stated it does not support either current bid, citing potential "significant downside for European cinema."
EU regulators have also approached cinemas for views on the merger's impact on exclusive theatrical windows. Historically, EU regulators have rarely blocked media mergers, as seen with the Disney-21st Century Fox deal.
United States
The proposed acquisitions are expected to undergo antitrust review in the United States. A House Judiciary Committee hearing has discussed streaming competition and potential merger impacts on consumers.
"Mergers of this nature typically undergo rigorous scrutiny." — Professor Rebecca Haw Allensworth, Vanderbilt Law School
Lawmakers in Washington have voiced concerns regarding potential effects on consumer choice and pricing. Netflix has noted a $5.8 billion payment obligation to WBD if its deal does not proceed. The regulatory assessment will depend on the definition of the competitive landscape within the entertainment sector.
Timeline and Next Steps
Warner Bros. Discovery has announced a seven-day engagement window with Paramount to clarify its "best and final offer" for a takeover. Simultaneously, WBD has reiterated its commitment to its agreement with Netflix and recommended shareholders approve this pact at a special meeting on March 20.
WBD had outlined plans in June to separate its streaming and studio operations into a new company, distinct from its cable business (CNN, Discovery, TNT Sports, Discovery+). The cable counterpart, "Discovery Global," is slated to become a new publicly-traded company by the third quarter of 2026.
The EU's initial deadline to clear or open an in-depth review is July 7.
Market Response
Following the announcements:
- Warner Bros. shares increased by nearly 2%
- Netflix shares declined by nearly 2%
- Paramount's shares fell by nearly 6%
Broader Industry Context
The proposed acquisitions occur during a period of consolidation in the media and entertainment industry. The transactions, if approved, would grant the Ellison family or Netflix control over significant media assets including Hollywood studios, cable networks, and streaming platforms.
Donald Trump has publicly stated a desire for CNN to be sold as part of any deal involving WBD. FCC Commissioner Anna Gomez has described certain actions related to merger proceedings as an "unprecedented form of government control over newsroom decisions."
The proposed deals are occurring amid ongoing debates about media concentration, press freedom, and government influence on news organizations. The FCC and the Department of Justice possess authority to reject deals deemed to threaten public interest or violate antitrust law.