Any list of epically bad business decisions should include John Antioco, then chief executive of DVD rental giant Blockbuster, turning down the chance to buy Netflix for $50m in September 2000, saying “the dotcom hysteria is completely overblown”.
Blockbuster’s business has vanished. Netflix is now an online content-streaming behemoth worth $425bn. On Friday, it announced an $83bn takeover of Warner Brothers, the Hollywood studio that made Casablanca, The Godfather, Blade Runner and the Harry Potter films for the big screen and hit TV series such as Friends and Game of Thrones.
The acquisition has upset some Hollywood creatives, who fear, despite Netflix’s promises, that inevitable cost-cutting will lower quality and mean fewer cinema releases. Veteran actor-activist Jane Fonda has claimed the deal “puts Hollywood, and democracy, at risk”.
Donald Trump’s Maga supporters have raged on social media against a deal they claim is a Barack Obama-led takeover of CNN. Reed Hastings, the billionaire Netflix founder, is a big donor to the Democrats, and his wife served as an ambassador under Obama, whose former UN ambassador, Susan Rice, sits on Netflix’s board.
The only snag: CNN will not be part of the Netflix deal but form part of a new standalone company, Discovery Global.
Related articles:
CNN would been part of the deal, however, and at risk of potential rightwing interference, had Warner Bros gone to Trump’s preferred bidder, Paramount, owned by tech billionaire Friend of Donald, Larry Ellison and his son David.
The Ellisons, with the backing of Saudi Arabia’s sovereign wealth fund, may yet return with a bigger bid. And the Trump administration will probably try to block Netflix on anti-trust grounds, citing growing monopoly power over content creation and the inclusion in the deal of HBO Max, one of Netflix’s main competitors in the online streaming wars. To be continued…
Photograph by Donaldson Collection/Michael Ochs Archives/Getty Images