Deal or no deal? The inside story of the battle for Warner Bros | Donald Trump

Donald Trump has made no secret of his desire to control the US media industry during the first 10 months of his second presidency – From encouraging TV networks to fire journalists, comedians and critics he doesn’t like to forcing regulators to revoke broadcasting licences. Now he looks set to hammer out the terms of one of the biggest media deals in history.

It’s a deal that could have repercussions not just in the United States but around the world, with not only the future of Hollywood but also the news landscape at stake.

Another American president would probably have politely declined to comment when asked by a reporter about a massive media merger that required fact-based oversight and regulatory approval by a purportedly independent-minded branch of their administration.

But when Trump was asked on Sunday about Netflix’s $82.7bn (£61.8bn) deal to buy the studio and streaming businesses of media company Warner Bros Discovery, whose assets range from Batman and Casablanca to The Sopranos, Succession and CNN, he did not shy away from saying he would “be involved” in reviewing the deal.

Days later, Paramount Skydance, the company behind the Paramount Pictures movie studios, the CBS US TV network and the UK’s Channel 5, a media conglomerate with close ties to its management, hit back with a hostile bid of $108 billion for the company.

Trump later made a contrasting comment about his role.

“I’m not involved in this,” he told reporters on Wednesday, adding: “I’ll probably be involved, maybe I’ll be involved in the decision. It depends. You’ve got some good companies bidding on this offer.”

Contradicting himself, Trump then put forward one condition for backing the deal: The company that bought WBD’s studio, HBO and broadcast assets must also buy its television stations and make major changes to CNN, the cable news network he has long disparaged.

“I think CNN should be sold because I think the people who currently run CNN are either corrupt or incompetent,” he said.

Paramount, run and backed solely by Trump supporters, had bid for the entire company.

This isn’t normal, commentators and former antitrust officials say they quickly pointed out. “This was not designed as a system where the president would wake up one morning and make a decision. In fact, it was supposed to be the exact opposite,” said Tim Wu, a Columbia University law professor who served as the president’s special assistant for competition and technology policy in Joe Biden’s White House from 2021 to 2023.

During the Biden administration, “we followed the old rules, and the old rules suggested that the White House should stay very far away from mergers,” Wu said, but “the parties always wanted us to get involved.”

“The whole thing was set up to keep the White House at bay,” he said. “Is this the White House? It’s a completely different kind of place.”

Phillip Berenbroick, who serves as chief counsel to the U.S. Senate’s judiciary subcommittee on antitrust matters, said: [Trump’s] He cares, and he says so openly, which is different from how most presidents and most administrations approach the antitrust review process. “I think he likes to play the role of deal maker.”

Paramount’s starring role raises the possibility of Trump’s involvement, given that the company is backed by longtime friend and Oracle co-founder Larry Ellison and run by his Trump-friendly son David. who spoke the company’s “good” relationship with management.

Another factor that could be in Paramount’s favor for Trump could be the role of his son-in-law Jared Kushner, whose investment firm Affinity Partners was the outside funder of the bid; but Trump said earlier this week that he had not spoken to him about it.

Massachusetts Sen. Elizabeth Warren and several of her fellow Senate Democrats cried foul.

“Donald Trump appears to be saying that any Warner Bros bidder should make a deal with him – and that could involve a donation to his gold-plated ballroom, or getting rid of a news source he doesn’t like, or just making films that flatter him,” he told the Guardian.

“But Donald Trump should not be the final decision maker here. This deal needs to be reviewed fairly and independently, and the strong antitrust laws already on the books need to be directly enforced.”

However, despite Trump’s apparent preference, this agreement is not finished yet. Whichever company ultimately wins out for WBD — and WBD has said it will evaluate Paramount’s offer and submit a proposal to its shareholders within 10 days — the deal will have to be approved by the justice department’s antitrust division, led by Gail Slater, an attorney with a solid reputation around Washington.

Wu emphasized that although the justice department has the most important role to play, the decision to approve the merger could easily be challenged by the state attorney general or attorneys general, and California, which is ground zero for the entertainment industry, would likely take adverse action and possibly delay the deal.

“Usually people say: ‘It all depends on what Trump thinks.’ “But I think it’s actually not that simple,” Wu said, adding: “Trump likes the idea that it all depends on what Trump thinks.”

When asked about the Paramount offer on Monday, Trump was neutral, suggesting that neither Netflix nor Paramount are “especially good friends of mine”; but a White House official said he had good relationships with both companies and had no position one way or the other.

Trump acknowledged that he recently met Netflix co-chairman Ted Sarandos and called him “wonderful,” but said Sarandos gave him no guarantees about the merger.

Trump said approval of the deal would depend on how much market share Netflix gets by acquiring WBD, which he said “could be a problem” given its current dominance in the streaming business. “I want to do the right thing,” he said. “Doing the right thing is very important.”

Victor Pickard, a professor of media policy and political economy at the University of Pennsylvania, said both deals were “highly questionable from a legal standpoint” as WBD’s merger with Paramount or Netflix would likely serve to greatly reduce competition in Hollywood. “It seems to me that this is a textbook case of being viewed as anticompetitive in violation of our antitrust laws, but that certainly doesn’t mean it won’t happen.”

Berenbroick, now a senior strategist at the Project for American Economic Liberties, predicted the merger would “raise red flags” for state, federal and global regulators because of the “significant consolidation” that would ensue. He expressed confidence in career employees in the justice department’s antitrust division. “These people are really professional and good at their jobs,” he said. The department could sue to block the deal, as it did unsuccessfully in 2017 to stop the merger of AT&T and then CNN parent Time Warner.

Industry experts say Trump could block the government’s case in a potential lawsuit by expressing a preference for one or another bidder, creating a skewed perception of the process.

Despite concerns about consolidation, both Netflix and Paramount have publicly stated that their companies would have an easier time gaining regulatory approval for the deal. And both companies have hired officials with ties to Trumpworld, potentially smoothing the path to approval. In October, Paramount hired its chief legal officer, Makan Delrahim, who served as head of the justice department’s antitrust division during the first Trump administration. Not wanting to be left behind, Netflix last week He tapped Virginia Boney Moore, Trump’s former special assistant for legislative affairs.

But Trump clearly has a closer relationship with the Ellisons, and White House officials have previously discussed their preference for Paramount to emerge as the winning bidder for WBD, which officially put it up for sale in October. In its filing with the Securities and Exchange Commission, the top U.S. financial regulator, Paramount said Netflix’s acquisition of WBD would come with “extraordinary regulatory risks” and a resulting “longer timeline for a possible closure.”

In an interview with CNBC on Monday, David Ellison acknowledged that he had recent conversations with Trump, citing CNN. (The Guardian first reported in November that Ellison’s father, Larry, had spoken to a senior White House official about potentially taking down two mainstays of the administration’s views, including Trump critics Erin Burnett and Brianna Keilar.)

Asked if he thought Trump would “embrace” CNN owner Paramount Skydance, Ellison said: “We’ve had great conversations with the president about this… but I don’t want to speak for him in any way.”

Pickard said reported conversations between Trump and the Ellisons about possible layoffs at CNN were “deeply disturbing” and “absurd for any democratic society worthy of the name.”

“The ultimate goal of all this is that Trump wants to eliminate any capacity for dissenting views or independent journalism,” he added.

Trump largely praised the Ellisons for their run of CBS News, which will likely be merged with CNN. Last month, Trump participated in his first interview with 60 Minutes in five years, calling “anti-woke” commentator Bari Weiss, now the network’s newly appointed editor-in-chief, a “wonderful person.” On Sunday, David Ellison sat in Trump’s box at the Kennedy Center Honors ceremony in Washington, hosted by the president himself.

But minutes after Paramount announced its offer Monday, he took to social media to criticize the company for an interview with retired congresswoman Marjorie Taylor Greene on CBS’ Sunday newsmagazine show 60 Minutes. “But my real problem with the show wasn’t the low IQ villain, it was that Paramount, the new owner of 60 Minutes, would allow a show like this to air. THEY ARE NOT BETTER THAN THE OLD OWNER.”

These are just the opening salvos in a corporate battle that could take months to resolve and will ultimately reshape global media. One antitrust expert said it seems likely that Trump could pressure Attorney General Pam Bondi to approve a deal of his choosing.

“If the president wants this agreement approved and he tells Pam Bondi, ‘I want this agreement approved’ … they will find a way to approve it,” Master said. “But that doesn’t mean states can’t come in and fight against the agreement.”