Warner Bros. could be acquired by Paramount for $111 billion The geography of power in the world of cinema has been definitively rewritten

After the complicated saga filled with hypotheses and delays regarding the new owner of Warner Bros. Discovery, an agreement has been reached. Netflix has withdrawn from raising its offer for Warner Bros. Discovery, paving the way for Paramount Skydance to now conclude one of the longest and most controversial battles for control of one of Hollywood's most legendary film studios. The deal, with an astronomical value of approximately 111 billion dollars, if finalized, will allow Paramount Skydance to acquire the entire Warner Bros. Discovery, including its studios, the HBO Max streaming service, and networks such as CNN.

The decision was announced yesterday after Warner Bros. Discovery's board of directors declared Paramount Skydance's latest proposal superior, far surpassing the agreement signed in December with Netflix for the purchase of part of the assets (film studios, HBO and streaming) for approximately 82-83 billion dollars, including debt. Netflix's top executives, faced with the new price, described the acquisition as “no longer financially attractive”. But it's not over yet.

Obstacles to Closing the Deal

Despite the green light from Warner Bros.' board, the transaction is not yet concluded. California Attorney General Rob Bonta stated on Thursday that “it is not a done deal”. The California Department of Justice has an open investigation and intends to conduct a “vigorous review”, considering the entertainment industry a critical sector for the state's economy.

Paramount Skydance will also need approval from the U.S. federal Department of Justice and European authorities. According to Reuters, the merger would unite two major film studios, two streaming platforms (Paramount+ and Max) and two important news organizations (CNN and CBS), potentially creating a near-monopoly that could violate antitrust laws. In reality, the BBC reports that the current political environment could favor approval by the American government, which is favorable to Paramount. However, both the California government and the European Union could have objections.

What Are the Implications of the Warner Bros. Acquisition?

If the deal is approved, one of the world's largest media conglomerates will be born. Paramount Skydance would in fact acquire the Warner Bros. studios and their vast catalog of films and franchises, the entire HBO Max with its intellectual properties, and a huge package of networks that includes CNN, CBS, various sports channels, and even networks like Nickelodeon and Comedy Central.

The greatest concern actually regards CNN's news channels, which belong to Warner Bros. Discovery. Larry Ellison, the main financier of the acquisition, is a major Republican donor and has close ties to Trump who has repeatedly criticized CNN, calling its executives “corrupt or incompetent” and suggesting in December that the network should be sold as part of any Warner Bros. deal. If the acquisition were finalized, CNN's journalistic independence would essentially be over. Somewhat similar to what recently happened with the Washington Post acquired by Jeff Bezos.

Things are no better for the film industry itself. If the Netflix acquisition hypothesis had already raised fears that the historic film studio would be swallowed by a company known for digital releases and low quality of its products, Paramount's option, while preserving the film studio identity, risks turning the media giant into a gigantic pro-Trump propaganda machine. On a more practical level, however, the operation will likely involve staff cuts and production reductions.