Days after Netflix announced it had won the bidding war against Warner Bros. Discovery – thanks to a deal valued at $82.7 billion – it appears the deal could face a significant obstacle: Donald Trump. The US president said the duo’s combined size “could be a problem”.
Speaking at an event at the John F. Kennedy Center in Washington DC, the President of the United States noted that Netflix’s “already very large market share” would “likely increase significantly” if the deal were to go through.
He’s not wrong either.
Current market share estimates suggest that Netflix and HBO Max (WBD’s streaming service) together control 34% of the U.S. streaming market – which is higher than the level of control that the U.S. Department of Justice’s antitrust rules would allow after a merger. However, these figures do not include YouTube.
It is believed that Netflix’s lawyers will argue that Netflix and WBD’s market share is much smaller when Google’s platform is taken into account – with statistics showing that YouTube has the highest video streaming audience share, by far. They may also try to downplay WBD as a streaming rival and instead focus on its usefulness as a production studio and content library.
Personal policy
Beyond market share considerations, the president’s comments about wanting an unprecedented level of involvement in negotiations have led some to speculate whether more personal views might play a role in decision-making.
Trump had very positive things about Netflix co-CEO Ted Sarandos, calling him a “tremendous person” who has “accomplished one of the greatest jobs in the history of cinema.”
However, reports also suggest (via The Guardian) that President Trump would have preferred that Paramount’s bid to buy WBD prevail. David Ellison is the chief executive of Paramount, and the deal to buy WBD was supported by his father, Larry Ellison, a staunch Trump ally. Larry Ellison is also at the center of the TikTok takeover in the United States.
David Ellison directly referenced having a “Trump card” (via The Independent) in his pocket to aid a possible acquisition of Paramount WBD before the Netflix deal was chosen, and more recently, Paramount called the Netflix deal “unfair.”
None of this is to say that personal politics will be a key consideration for the administration, but it does further fuel speculation that the Netflix deal may ultimately stall.
To block or not to block
That said, we’ve already covered these arguments and more in our analysis with experts on what the Netflix and Warner Bros. deal means. could mean to you. TL;DR: more content on one platform, but price hikes are likely and working in the entertainment industry could become even more difficult.
So to some extent, while Trump’s involvement isn’t normal, it’s not unreasonable for Netflix to have already considered every possible way the deal could fall apart, and despite those pitfalls, it’s so sure things will get approved that the deal includes a $5.8 billion breakup fee (via The Hollywood Reporter).
It wouldn’t pay off if Netflix left; Netflix pays this fine if the deal doesn’t close for any reason. That’s a lot of money to offer if it’s not reasonably certain regulators will approve the acquisition.
We’re in the early stages of a deal that’s not expected to close until late 2026 — maybe not even until 2027. Which is to say, we have plenty of time to see a few twists and turns play out before we know whether the HBO Max rebranding saga will end at “Netflix” or something else.
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