Days after Netflix announced it had won the bidding war over Warner Bros. Discovery – thanks to an agreement valued at $82.7 billion – it appears that the deal may hit a sizable roadblock: Donald Trump. The US President said the combined size of the duo “could be a problem.”
Speaking at an event at the John F Kennedy Center in Washington D.C., the United States President remarked that Netflix’s already “very big market share” would likely “go up by a lot” if the deal was allowed to go ahead.
He isn’t wrong either.
Current market share estimates suggest Netflix and HBO Max (WBD’s streaming service) control a combined 34% of the US streaming market – which is above the level of control the US Department of Justice’s antitrust rules would allow after a merger. These figures, however, crucially don’t include YouTube.
It’s believed that Netflix’s lawyers will argue that Netflix and WBD’s market share is much smaller when you take Google’s platform into account – with stats showing YouTube has the highest video streaming viewership share by some margin. They may also try to downplay WBD as a streaming rival and instead focus on its utility as a production studio and content library.
Personal politics
Beyond market share considerations, the President’s comments about wanting to have an unprecedented level of involvement in the negotiation have led some to speculate if more personal leanings could play a part in decision-making.
Trump has had some very positive things about Netflix’s co-CEO Ted Sarandos, calling him “a great person” who has “done one of the greatest jobs in the history of movies”.
However, reports also suggest (via The Guardian) that President Trump would have preferred Paramount’s offer to buy WBD to win out. David Ellison is the chief executive of Paramount, and the deal to buy WBD was backed by his father, Larry Ellison, a staunch Trump ally. Larry Ellison’s also at the center of the US TikTok buyout.
David Ellison directly referred to having a “Trump card” (via The Independent) in his pocket to help a possible Paramount WBD acquisition go through ahead of the Netflix agreement being chosen, and more recently, Paramount described the Netflix deal as “unfair.”
None of this is to say personal politics will be a key consideration for the administration, but it adds further fuel to the fire of speculation that Netflix’s deal could ultimately get blocked.
To block or not to block
All that said, we’ve already covered these arguments and more in our analysis with experts on what the Netflix and Warner Bros. deal could mean for you. TL;DR: more content on one platform, but price hikes are likely, and working in the entertainment industry could become even more challenging.
So to some extent, while Trump’s involvement isn’t par for the course, it’s not unreasonable for Netflix to have already considered all of the possible ways the deal could collapse, and despite these pitfalls, it’s so confident things will be approved that the deal includes a $5.8 billion breakup fee (via The Hollywood Reporter).
This wouldn’t just pay out if Netflix walks away; Netflix pays this fine if the deal doesn’t go through for any reason. That’s a lot of money to offer if it isn’t reasonably certain that regulators will approve the acquisition.
We’re still very early days in a deal that isn’t expected to close until the end of 2026 – potentially not even until we’re into 2027. That is to say, we have a lot of time to see some twists and turns play out before we know if HBO Max’s name change saga will stop at ‘Netflix’ or something else entirely.
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