By: Daniel Metz
On November 20, 2025 the titans of film distribution—Netflix, Paramount and Comcast—entered into a high profile bidding war.[1] Their target: Warner Bros Discovery (WBD).[2]
WBD has one of the most valuable libraries of content in the entertainment industry. The company owns the HBO network, which includes The Sopranos and The White Lotus. [3]Other intellectual property under the WBD’s control are the classic T.V sitcom Friends and, perhaps the crown jewel, the Harry Potter film franchise.[4] Prior to the bidding war, the company was valued at $58 billion.[5] The winner of the bidding war likely decides whether this content will be available on Netflix, Paramount+, or Peacock.
Hollywood insiders and Wall Street hedge funds alike waited with bated breath for the outcome. One month later, they had a preliminary answer when the WBD board of directors announced that they had agreed to sell their film and television assets to Netflix for $72 billion.[6] Netflix triumphantly announced “this acquisition brings together two pioneering entertainment businesses, combining Netflix’s innovation, global reach and best-in-class streaming service with Warner Bros.’ century-long legacy of world-class storytelling,” in a December 5, 2025 statement.[7]
However, Netflix still must get past two major hurdles before they can add Harry Potter to their offerings. First, the deal needs to be approved by a WBD shareholder vote that will be taken within the next few months.[8] Second, they need to get past Federal regulators who will be scrutinizing the deal for potential violations of antitrust law.[9]
Waiting in the wings is Paramount, who has licked its wounds after losing the bidding war, and relaunched their pursuit of WBD.[10] Paramount is urging WBD shareholders to reject the Netflix bid, highlighting the potential antitrust issues, and touting themselves as a more regulator-friendly alternative.[11]
The antitrust concerns about Netflix acquiring WBD will likely be investigated by the Federal Trade Commission (FTC) and the Department of Justice (DOJ).[12] Both agencies may scrutinize the acquisition under the Clayton Antitrust Act which aims to prevent any acquisition that tends to create a monopoly.[13] Critics of the acquisition argue that it will give Netflix enormous control over Film and T.V distribution, which will allow it to substantially raise prices and hurt consumers.[14] Critics also argue that it will destroy the movie theater business because Netflix leadership has historically shown antipathy to such theaters, with their C.E.O Ted Sarandos calling them an “outdated business model,” and releasing most of Netflix’s original movies directly to their online streaming platform.[15] If the deal were to go through, Netflix could prevent any new movies made by WBD from ever going to theaters, which would ultimately make it impossible for the theaters to stay in business.[16]
Netflix’s best argument to defeat any antitrust action seeking to block the acquisition is that YouTube currently claims a much larger online audience than either Netflix or WBD.[17] A combined Netflix and WBD would command just over 14% of the total time viewers spend watching T.V, which would be a hair above YouTube’s roughly 13%.[18] If YouTube is considered their largest competitor, it seems like the two companies would be at relative parity in the market for digital entertainment.[19] This would negate the possibility of Netflix being considered a monopoly.
However, critics of the deal argue that YouTube should not be seen as a direct competitor to Netflix because its short-form, user-generated videos appeal to an entirely different audience than WBD’s professionally developed film and T.V.[20] If you remove YouTube from the picture, the next largest competitor to the combined Netflix-WBD would be Disney, which has only about 9% of the total T.V viewing audience.[21] This would make Netflix-WBD look like a behemoth which dominates the market, and therefore a violation of antitrust law.
Whether the deal is approved largely depends on whether a court finds that YouTube should be seen as competing in the same marketplace as Netflix, and how aggressively the Federal regulators choose to argue that it should be.
Any FTC or DOJ investigations fall within the ambit of President Donald Trump’s Executive branch. President Trump reportedly asked to be personally apprised of any antitrust probes related to the acquisition and, during the bidding war, was expecting all potential buyers of WBD to be actively vying for his approval.[22] He was quoted as saying, “none of them are particularly great friends of mine,” when referring to the WBD bidders.[23] Behind the scenes, however, it was generally believed that the President preferred Paramount to acquire WBD rather than Netflix.[24] Paramount executives reportedly promised Trump officials that CNN, a subsidiary of WBD, would provide much more favorable news coverage to the President if it was brought under Paramount’s control.[25] This came days after Larry Ellison, the billionaire owner of Paramount and a major Trump-donor, called the President to tell him that a Netflix-WBD deal would improperly stifle competition.[26]
Shareholders may be tempted to reject the Netflix deal given that the Trump-controlled regulatory agencies are likely to pursue antitrust investigations much more aggressively when scrutinizing it than they would be to a similar Paramount deal.[27] Trump himself has said the size of Netflix and WBD combined “could be a problem… there’s no question about it.”[28] Paramount has made a $108.4 billion hostile bid directly to the WBD shareholders, and this may seem very appealing given that it would likely have a smoother path to Federal approval.[29]
The Netflix-WBD deal raises important questions about how the digital entertainment market is defined by regulators with regards to antitrust law. How this question gets answered, and if it will get answered, remains largely up-in-the-air considering the relatively unpredictable executive branch that will be overseeing it.
[1] Meg James, Warner Bros. auction poised to recast Hollywood with Paramount, Comcast and Netflix vying for the prize, L.A Times (Nov. 20, 2025), https://www.latimes.com/ [https://perma.cc/29PA-L4M2].
[2] Id.
[3] Lucas Shaw & Michelle F. Davis, Warner Bros. Begins Exclusive Deal Talks With Netflix, Bloomberg (Dec. 4, 2025), https://www.bloomberg.com/news/articles/2025-12-05/warner-bros-is-said-to-begin-exclusive-deal-talks-with-netflix?embedded-checkout=true.
[4] Id.
[5] Market capitalization of Warner Bros. Discovery (WBD), Companies Market Cap, https://companiesmarketcap.com/[https://perma.cc/Z7S4-88VV].
[6] Wyatt Grantham-Phillips & Matt Ott, Netflix to acquire Warner Bros. studio and streaming business for $72 billion, (Dec. 5, 2025), [https://perma.cc/D4XR-K3JB]
[7] Netflix to Acquire Warner Bros. Following the Separation of Discovery Global for a Total Enterprise Value of $82.7 Billion (Equity Value of $72.0 Billion), Netflix (Dec. 5, 2025), [https://perma.cc/42PJ-SB8C]
[8] Lucas Shaw, The Warner Bros. Bidding War Is Over (Jan. 25, 2026), https://www.bloomberg.com/news/newsletters/2026-01-25/the-warner-bros-bidding-war-is-over.
[9] Id.
[10] Id.
[11] Id.
[12] Antitrust, Georgetown Law, [https://perma.cc/MKL2-2XCA]
[13] 15 U.S.C.A. § 14 (West).
[14] Josh Wright, Just How Much Antitrust Risk Is There in a Netflix – Warner Brothers Merger? (Dec. 29, 2025),
[https://perma.cc/S9E7-XWBB]
[15] Ethan Shanfeld, Netflix CEO Ted Sarandos Says Movie Theater Model Is ‘Outdated’: ‘Most of the Country’ Cannot ‘Walk to a Multiplex’ (Apr. 24, 2025),
https://variety.com/ [https://perma.cc/H9WN-S6DF].
[16] Id.
[17] Wright supra note 14
[18] Id.
[19] Id.
[20] Id.
[21] Id.
[22] Joe Flint, Brian Schwartz & Natalie Andrews, Behind Paramount’s Relentless Campaign to Woo Warner Discovery and President Trump, Wall Street Journal(Dec. 8, 2025), https://www.wsj.com/business/media/paramount-netflix-warner-bros-battle-ellisons-a86fe15c.
[23] Id.
[24] Jo Ling Kent & Kiki Intarasuwan, Jared Kushner’s Affinity Partners backs out of Paramount Skydance’s hostile bid for Warner Bros. Discovery, CBS News (Dec. 16, 2025) https://www.cbsnews.com/ [https://perma.cc/XLW3-XAPN]
[25] Id.
[26] Id.
[27] Michael Shane, The Orphans of the New System: Why Sony and Lionsgate Are Running Out of Time, LinkedIn(Nov. 21, 2025), https://www.linkedin.com/ [https://perma.cc/8C8K-F3YP].
[28] Darlene Superville, Trump says ‘there’s no question’ Netflix deal to buy Warner Bros. could be problematic (Dec. 8, 2025), [https://perma.cc/2FHU-686M]
[29] Kent supra note 24
