UPDATE: Former President Donald Trump has issued an urgent warning regarding Netflix’s $72 billion acquisition of Warner Bros. Discovery, expressing significant concerns about potential market dominance. Trump’s remarks, made on Sunday, could trigger serious regulatory scrutiny over the merger, raising alarms about the combined entity’s market power in the entertainment industry.
Trump stated, “Well, that’s got to go through a process, and we’ll see what happens,” confirming his recent meeting with Netflix co-CEO Ted Sarandos. He emphasized that the deal could pose a problem due to the sheer size of the market share that Netflix would control post-acquisition. The merger would unite the world’s leading streaming service with the iconic HBO Max, amplifying worries about monopolistic practices.
As fears mount, betting odds on prediction marketplace Polymarket show a plummeting 23 percent chance that the acquisition will close by the end of 2026, down from nearly 60 percent prior to Trump’s comments. The Justice Department‘s antitrust division is expected to conduct a thorough review, with the potential to argue that the merger is illegal, as it would elevate Netflix’s market share significantly beyond a critical 30 percent threshold.
Trump pointed out, “Netflix has a very big market share, and when they have Warner Brothers, you know, that share goes up a lot.” He indicated that he would be personally involved in the decision-making process concerning the deal.
In response, Netflix is preparing to defend the acquisition by highlighting that competing platforms like Alphabet Inc’s YouTube and ByteDance’s TikTok should factor into any market analysis. This strategy could dramatically reduce Netflix’s perceived dominance. Reports indicate that Sarandos recently lobbied Trump at the White House for support regarding the deal.
The ramifications of this merger could extend beyond market dynamics, as Warner Bros. chose Netflix over Paramount Skydance Corp., a decision that might ignite political tensions in Washington. Paramount is backed by billionaire Larry Ellison, who has strong ties to Trump, complicating the landscape further.
In Europe, regulators are expected to closely examine the proposal, with the European Union likely to launch an extensive review. In the UK, prior to the announcement, Baroness Luciana Berger of the House of Lords raised concerns about how such a transaction could impact competition and consumer prices.
Despite these challenges, Netflix remains optimistic. Insiders report that the company believes it can successfully navigate antitrust scrutiny by arguing that major competitors, such as Amazon.com Inc’s Prime and Walt Disney Co, also challenge its market presence. Furthermore, Netflix is expected to argue that over 75 percent of HBO Max subscribers are already Netflix users, framing the offerings as complementary rather than competitive.
Netflix plans to contend that owning Warner Bros. will allow them to lower content costs, streamline technology, and bundle services, ultimately leading to lower prices for consumers.
As this high-stakes deal unfolds, all eyes will be on regulatory bodies and the potential impact on the streaming landscape. Stay tuned for further updates on this developing story, as the intersection of politics, entertainment, and consumer rights becomes increasingly complex.
