The proposed acquisition of Warner Bros. Discovery (WBD) has become increasingly contentious with Netflix Inc (NASDAQ:NFLX) positioned as the current frontrunner. However, this position faces a challenge, not only from the rival bid by Paramount Skydance (NASDAQ:PSKY) but now also from political and cultural opposition expressed by former President Donald Trump.
Netflix's pursuit to acquire Warner Bros. Discovery entails integrating the film and television studio and streaming assets of the media giant into its existing platform. Paramount Skydance has actively contested this bid by submitting multiple proposals for the entire company, encompassing cable and television assets. Despite these efforts, Warner Bros. Discovery has yet to accept Paramount Skydance’s offers, even with financial backing personally guaranteed by billionaire investor Larry Ellison.
Adding a new dimension to the merger debate, former President Trump shared a post on his Truth Social platform over the weekend advocating against the Netflix acquisition. The post endorses a December article by John Pierce for One America News, which articulates opposition to the deal on grounds beyond traditional antitrust arguments. Pierce, a lawyer known for defending several participants involved in the January 6 U.S. Capitol incident, contends that regulatory bodies such as the Department of Justice and the Federal Trade Commission should prevent the merger due to its implications on "free expression and America's cultural pluralism."
Pierce's thesis suggests the combined Netflix-Warner entity would wield excessive influence as a "dominant cultural gatekeeper," potentially disseminating "progressive narratives" widely and stifling ideological diversity. The article calls for blocking what it terms a "woke media monopoly" before irreversible cultural damage occurs. Trump's endorsement of this perspective, underscored by his call to "stop the Netflix Cultural Takeover," signals his alignment with these concerns.
Trump's engagement in the merger discourse is compounded by his previously expressed favor toward Paramount Skydance, partly attributed to close ties with investor Larry Ellison, a known ally. During the early phases of the Warner Bros. Discovery sale process, an administration official intimated that bidders outside of Paramount may face more considerable hurdles, implicitly favoring Paramount Skydance's prospects given their prior successful merger approval during the Trump administration. The official remarked, "The Warner board needs to think very seriously not just on the price competition, but which player in the suitor pool has been successful getting a deal done," highlighting Ellison’s faction as particularly well-positioned.
Nevertheless, the bidding scenario is complicated by broader political opposition. Certain Democratic congressional figures also oppose Netflix's acquisition of Warner Bros. Discovery, although their objections stem primarily from antitrust concerns regarding market consolidation rather than ideological content. Interestingly, while these lawmakers do not favor Netflix, their stance does not extend to support for Paramount Skydance, which has generated suspicion due to previous financial settlements with Trump and perceived political affiliations.
Paramount's $16 million settlement with Trump preceding its merger with Skydance indeed attracted criticism from legislators such as Senator Elizabeth Warren (D-Mass.), who characterized the payment as a potential bribe. Warren and others have voiced opposition to both Netflix and Paramount’s acquisition efforts of Warner Bros. Discovery.
Additionally, Paramount's editorial direction has undergone scrutiny following Bari Weiss’s appointment as CBS News editor-in-chief, prompting claims of a political shift perceived as favorable to Trump. Trump's direct comments on the Warner Bros. Discovery merger approval process and his disparagement of CNN as a "disgrace" advocating its sale further intensify fears about presidential influence over media industry transactions.
In summary, John Pierce’s argument warns of a cultural dominance risk from a Netflix-led merger, whereas the counter-narrative suggests a Paramount Skydance victory could similarly impose ideological biases, although favoring conservative perspectives. These competing narratives underscore the complex interaction of market dynamics and political influence shaping the fate of this high-profile media consolidation.