Politicians in Washington are sounding the alarm as Netflix moves closer to becoming a massive media giant. The streaming company is planning an all-cash offer to finalize its $83 billion acquisition of Warner Bros Discovery, a deal that would bring HBO and Warner Bros studios under its control.
Critics argue that the merger would give Netflix nearly 50% of the streaming market, creating a monopoly that could stifle competition and innovation. Despite these concerns, Netflix is pushing ahead with the all-cash offer to speed up the acquisition and block a rival bid from Paramount Skydance.
Paramount has launched a hostile $108.4 billion takeover attempt, backed by the Ellison family. WBD’s board has rejected the offer due to its debt financing, but Paramount is trying to replace the board to force the deal through. Netflix’s speed is a direct response to this threat.
The deal involves spinning off WBD’s linear networks like CNN and Discovery, leaving Netflix with the premium entertainment assets. While this separation simplifies the business, it does little to alleviate the political concerns about market dominance.
The market, however, is focused on the financials. WBD shares rose 1.6% on the news, suggesting that investors are more interested in the deal’s value than the political fallout. As the alarm bells ring in DC, Wall Street is cheering the creation of a new media superpower.