Three companies have submitted rival bids for Warner Bros, the first step in the auction of some of the best known brands in entertainment.
So what? Warner’s sale will transform Hollywood. Paramount Skydance, Netflix and Comcast are in the running for a sprawling empire that includes HBO, CNN and Warner Bros film and television studios. A deal could
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trigger the intervention of Donald Trump;
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prompt layoffs in an industry reeling from a production slowdown and two years of job losses; and
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close the lid on Hollywood’s Golden Age, with four of the Big Five studios owned by tech-based companies, or, in Paramount’s case, the scion of one.
All about the library. Franchises are Hollywood’s biggest business and Warner’s catalogue includes Superman, Batman, The Matrix, Game of Thrones, Harry Potter, The Lord of the Rings and the Ocean’s film trilogy. It also attracts maverick one-offs, including Casablanca, A Clockwork Orange, The Shawshank Redemption, Inception, Se7en, Barbie, Sinners and One Battle After Another.
Trump card. Analysts believe that Paramount Skydance, the only bidder keen to buy Warner Bros intact, is in the hot seat. Paramount is owned by David Ellison. His father Larry is the world’s second richest man, a Trump supporter and poised to be an owner of US TikTok. Paramount’s main franchise is Tom Cruise. With Warner Bros it would own liberal doyenne CNN and other media touchstones.
For the record. The California attorney general, Rob Bonta, says he is not in favour of this deal, but the White House could overrule him.
Netflix might chill. Like Comcast, Netflix is reportedly only interested in Warner’s Burbank movie studios and HBO. If Netflix owned the HBO Max streaming service, it would add 73 million people to its existing subscription base of 300 million.
Comcast’s long shadow. Comcast owns NBC Universal, Sky TV and is in talks to buy ITV. It is reportedly the preferred bidder of Warner Bros CEO David Zaslav. Adding HBO and HBO Max would provide the company with a premium streaming rival to Netflix. But Comcast lacks Ellison’s cash and Trump has called the company’s chair, Brian Roberts, “a disgrace to the integrity of broadcasting”.
What’s next, Doc? This first round of bidding is non-binding, effectively an expression of interest. Warner Bros will evaluate what’s on the table before Thanksgiving on Thursday and move to a second binding set of bids in December. The board wants to conclude the sale by the end of the year. Regulatory approval could take 12 months.
Sunny upside. A Warner Bros merger would deliver efficiency, cost savings and leverage for a company battling significant debt, shifting audience habits and shareholder demands.
That’s all folks… But as the Writers Guild of America points out, the merger will mean fewer buyers for scripts, reduced appetite for creative risk, and vanishing spaces for new ideas and untested IP, something Warner Bros has always championed.
Photograph by RGR Collection via Alamy.