Netflix to Buy Warner Brothers? No, Paramount Skydance!

[captveg]

Hasn't all that been frozen since the Ellisons took over?

[The Fanciful Norwegian]

I don't want to be too optimistic because quite a few of Netflix's prestige films have yet to be released on disc, but I also have no idea what determines that. For example, it's really strange to me that The Other Side of the Wind hasn't been made available to Criterion like so many others even though it's one of their lowest-streamed films. (Joseph McBride says Criterion is actually interested in licensing it.) I can only guess there's some other factor we're not aware of because I don't really see the logic there.

My theory has been that Neflix only licenses to Criterion when the filmmaker requests it and in this case he isn't around to do that. There are probably other factors at work—one would think Baumbach would want all of his Netflix films on Criterion, but it's been five years since the Marriage Story disc and we still don't have The Meyerowitz Stories or White Noise—but I think this is the big one. The problem is it's so rare for Netflix to do something like The Other Side of the Wind that there's not a whole lot of opportunities to confirm it (Napoleon might be one if Netflix actually got some distribution rights as part of their involvement with the latest restoration, but the Coppola factor complicates that). I agree it's not logical for a case like The Other Side of the Wind, but if I looked for logic in every decision a studio makes, my entire house would look like the Pepe Silvia meme.

[FrauBlucher]

A class action lawsuit has been filed against Netflix for its purchase of WBD

[pistolwink]

Best thing would be if WB wasn't sold at all, but if it must be and these are the options, why would someone think that Netflix is the better buyer? The company that has zero interest for physical media (apart from agreeing to license a handful of titles to Criterion)?

If that was the only issue, sure. But there's also the issue of the Ellisons being more than willing to to work toward the führer, I mean, bend to Donald Trump's desires, in a way that surpasses even the base-level complicty we're seeing from corporate America.

That said, I think this is a lose-lose proposition and it's impossible for me to "root" for any of the likely outcomes. At least it'll give me a lot to talk about when my class gets around to discussing the political economy of the media.

[Finch]

I honestly wonder if it would change Trump's hostile stance towards the Netflix merger if Warner said the Ellisons can have CNN. I think that's what Trump cares about the most, but the Ellisons obviously want much more than CNN. Oh, to be a fly on the wall in the WBD executive rooms now!

[Beloved Aunt]

a fly on the wall

or a hungry tsetse fly, oozing with pestilence and disease.

[hearthesilence]

I honestly wonder if it would change Trump's hostile stance towards the Netflix merger if Warner said the Ellisons can have CNN. I think that's what Trump cares about the most, but the Ellisons obviously want much more than CNN. Oh, to be a fly on the wall in the WBD executive rooms now!

FWIW, the Wall Street Journal just reported a recent visit to the White House where Paramount CEO David Ellison promised Trump that he would completely rehaul CNN if Trump "allowed" them to purchase Warner Bros. Discovery instead of Netflix.

If you want to see what even mildly friendly news coverage means to Trump, it's right there in today's headlines. Same news story reported by two different Chicago papers, top one is the Tribune and the bottom is the Sun-Times. (Tribune's owned by Alden Global Capital, and founder Randall Smith is a big Trump donor who currently sits on the Tribune board as do two other directors with close ties to Alden.) And read the text of the Sun-Times, pretty damning indictment of how Republicans covered for Trump even in his first term. Two GOP Congressmen were present when Trump said the same words in the White House back then and they refused to say anything about it afterwards.

[The Fanciful Norwegian]

I honestly wonder if it would change Trump's hostile stance towards the Netflix merger if Warner said the Ellisons can have CNN. I think that's what Trump cares about the most, but the Ellisons obviously want much more than CNN. Oh, to be a fly on the wall in the WBD executive rooms now!

Netflix is only bidding for the studio and streaming group, all of the basic cable holdings (except TCM) would be sold off separately. Ellison can have them if he wants, but he really doesn't—Paramount only bid for the whole kit'n'kaboodle because they thought it'd make their offer more attractive and because they reasoned Trump would look more favorably on a deal that puts CNN in the hands of a friend. Only a total chump (cough cough) would actually think that Ellison intends to hang on to the linear TV stuff for the long haul, which is why there's been virtually no discussion of Paramount buying it alone and conceding the studio and streaming group to Netflix.

[Matt]

I think the planned Discovery Global cable division is where Zaslav is offloading all of WBD's $38 billion of debt, so it's probably not an attractive proposition to buy on its own.

[Finch]

Bill Hunt (I know) says in today's column industry insiders told him WB and WAC's 2026 slate is locked in regardless of what happens to WBD long term.

[Finch]

AP reports that Kushner's firm is pulling out of the Paramount offer for WBD.

[hearthesilence]

It's just as well. Warner was about to send out a formal statement asking shareholders to reject Paramount's offer. EDIT: It looks like it was due to scrutiny over Kushner's role in this bid. Ever since news of their involvement was disclosed, the Trump administration has been trying to downplay the existence of any favoritism that was already blatantly displayed over the previous months.

[hearthesilence]

Relevant given the concerns discussed here: Christian Parkes, Jason Wald and Spener Collantes are leaving Neon for Warner's new contemporary film label. Parkes will lead it with the new label focusing exclusively on global theatrical releases with innovative marketing campaigns. Started by Michael De Luca and Pam Abdy, who have a history of championing burgeoning filmmakers, the venture looks to meet exhibition’s demand for more and diverse films beyond the blockbusters that have dominated most studio fare in recent years.

[Matt]

Oh wow, we're back in the USA Films, Paramount Vantage, Fine Line Features era.

[captveg]

A lot of the early statements from Netflix have me cautiously optimistic that they do see the need to have other revenue models, with Warner being the opportunity to get involved without building the infrastructure. We'll obviously see if that holds true, and they've been so overly focused on easing theatrical doomsday fears that packaged media has not been spoken about whatsoever. Is it too much to hope that they'll not only let packaged media continue, but that they'll also allow for their own library of titles to get occasional releases? Probably, but one can hold out hope.

[hearthesilence]

The Warner Bros. Discovery board is likely to tell shareholders before the market opens on Tuesday that it is taking Paramount Skydance's bid under review while still recommending the Netflix transaction that is up for a vote on March 20.

If WBD is formally considering the Paramount Skydance offer, the next move in this chess game will come from Netflix: The streamer has four days to match Paramount’s new offer, or it could bail out of the bidding process. A source close to the situation noted that WBD is legally bound to recommend its signed agreement with Netflix, valued at nearly $83 billion. Paramount has fielded a $108 billion offer for the entirety of WBD, including its cable channels. Netflix is buying Warner Bros. and HBO Max.

Netflix co-CEO Ted Sarandos, in a Feb. 20 interview with Variety, declined to say how the streamer would respond to a higher offer from Paramount. But he did say that Netflix has a “rich history” of being “willing to walk away and let someone else overpay for things.”

[hearthesilence]

Netflix has declined to increase its offer for Warner Bros. Discovery after the David Zaslav-led media company’s board declared Paramount Skydance’s new bid a “superior proposal.”

Just take a good look at CBS News and you'll see what's coming for CNN. Combined with what's already happened elsewhere, the overwhelming majority of the American news business is going to mirror Fox News for perpetuity.

[Never Cursed]

All of that depends on the enormous assumption that Oracle etc. remains financially stable, and the Ellisons continue to micromanage their cultural output on the level of a Murdoch. Neither of them seem nearly as well-informed, canny, or interested in cultural production as he is

[denti alligator]

There's also the issue of ratings. CNN's would plummet if they started sounding like Fox. But maybe I'm being naive.

[onedimension]

The only thing worse than Netflix buying Warner Brothers? Paramount buying Warner Brothers.

[hearthesilence]

CBS's ratings are tanking (even more), but I don't see them rolling back what they've done anytime soon - if anything, they're doubling down.

[denti alligator]

Ultimately, it's about money. So if they start losing too much of it, they'll have to change something. There will need to be a place for moderate to left Americans (over 50% last I checked) to get their news.

[The Fanciful Norwegian]

CNN's importance to the overall bottom line is so insignificant that I can't imagine shareholders would care. The only solace I can take is that linear TV as a whole is in probably irreversible decline and those holdings will be spun off eventually no matter what Ellison says now. (Plus there was always the possibility that he would acquire them anyway, given that Netflix weren't interested.) But he'll have plenty of opportunity in the meantime to reshape them in his own noxious image.

I feel worse about the film side—there were going to be layoffs no matter who won the bidding, but I was convinced (as supposedly were most WB employees) that Netflix would leave the studio more intact than Paramount, which I imagine will take a hatchet to it and reduce it to nothing more than a label a la TriStar or Orion. The cost-cutting that Zaslav did when he took over will look delicate by comparison. I doubt this will be good for theaters either, since I think Ellison is lying through his teeth about "30+ theatrical releases per year" and that once Paramount burns through the WB backlog their theatrical output won't be much higher than it is now.

[Matt]

Paramount just posted a fourth-quarter loss of over half a billion dollars, and their stock price has been on a steady decline since the Ellisions bought it. They're not exactly the model of financial prudence or even generating value for shareholders. If they buy Warner Bros., it's going to be bad in every way. I don't really care about CNN (it's been trash for years as far as I'm concerned) or about any of the Discovery stuff, but I am concerned about the Warner Bros. physical media unit and TCM, both of which seem like low-hanging fruit for cost-cutting idiots.

[Finch]

So we're back to panic buying Warner Archive BDs etc.