As events are leaning toward David Ellison andParamountprevailing in its $108 billion hostile-takeover bid for Warner Bros Discovery, almost a dozen Republican state attorneys general are insisting that the federal government heavily scrutinizeNetflix‘s bid for the iconic studio.
“We, the undersigned Attorneys General, write to express our concerns that the proposed merger between Netflix and Warner Brothers will likely result in undue market concentration that stifles competition and therefore creates higher prices, lower reliability, and less innovation for one of America’s major industries — all to the detriment of American consumers,” wrote 11 red state AGs ina letterto U.S. Attorney General Pam Bondi.
It added, “Given the stakes, we encourage the Department of Justice to subject this proposed merger to a thorough and exacting review under the Clayton Act.”
Read the full letter, sent Tuesday, here.
This latest political shoe to drop in the battle between Netflix and Paramount forWBDcomes just days afterthe U.S. Department of Justice began a formal antitrust probeinto the streamer run by co-CEOs Ted Sarandos and Greg Peters. The letter also comes the same dayParamount CEO David Ellison was a guest of GOP lawmakersat “good friend”Donald Trump’s State of the Union address last night.
Of course, realpolitik aside, the probes intoNetflix’s accepted $83 billion bidfor WBD’s streaming and studio assets has again been characterized as a form of consumer protection and consumer choice.
“This massive consolidation would place an unprecedented amount of content, distribution power, and market influence into the hands of a single corporation,” Montana Attorney General Austin Knudsen said in a press release of his own regarding the letter. “History shows us what happens when industries become dominated by a few giants: prices rise, choices shrink, and innovation suffers.”
Knudsen joined AGs from Alabama, Alaska, Iowa, Kansas, Nebraska, North Dakota, South Carolina, Tennessee, Utah and West Virginia.
Paramount and Netflix both did not respond to a request for comment on the new letter. Paramount reports fourth quarter earnings after the bell later on Wednesday. Warner Bros. Discovery financials will hit early on Thursday. Both will be followed by investor calls with executives, as stakeholders dissect CEO commentary, numbers and outlook for key divisions, from linear to streaming to studios, for clues to how this M&A process could, or should, unfold.
On various red carpets and in numerous interviews and subcommittee meetings, Sarandos has insisted that the streamer does not have and will not have a monopoly with or without the WBD deal. Taking a big-digital-picture approach, the exec says the real competition for Netflix is [soon-to-be Oscar rightsholder] YouTube, not other streamers.
Source: Drudge Report
