Last Thursday, Ted Sarandos, co-chief executive of Netflix, the most powerful force in global entertainment, was walking into the White House for a meeting when his phone delivered some big news news. The Warner Bros Discovery (WBD) board had declared Paramount’s latest offer “superior”, triggering a four-day window in which Netflix could match or exceed it.
The answer was already settled. Netflix’s board had decided the previous Monday that it would not raise its offer. Sarandos rang WBD chief executive David Zaslav personally to say they were walking away from a deal that would have delivered the studio behind Harry Potter and Batman, along with HBO and its vast library of prestige television, into Netflix’s hands.
On the other side of the country, on the Paramount lot in Hollywood, executives sipped champagne from paper cups.
To understand how we got here, you have to go back to last autumn, when WBD – a company that for most of its short existence has been in a state of controlled crisis − began seriously entertaining offers from potential suitors. The company was itself the product of a troubled 2022 merger between AT&T’s WarnerMedia and Zaslav’s Discovery Inc. That 2022 deal saddled the combined entity with enormous debt and left Zaslav wielding his cost-cutting axe with a ruthlessness that made him one of the most reviled figures in the industry.
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By late 2025, with a planned separation of its linear cable business creating an opening, WBD had attracted formal proposals from three bidders: Netflix, Comcast and Paramount Skydance. In December, Netflix appeared to have won, striking a deal valued at around $83 billion for the studio and streaming assets.
For Paramount, however, the prospect of losing was unthinkable. As one source close to the transaction put it: “Warner was something that Netflix wanted but did not need. For Paramount, it was existential.”
Netflix, worth some $400 billion, could absorb a defeat and keep going. Paramount, carrying its own heavy debt load, could not easily survive in a Hollywood landscape increasingly dominated by tech giants without a transformative acquisition.
So began the last-ditch campaign by Paramount CEO David Ellison and his father, Larry, to outmanoeuvre Netflix and force WBD’s reluctant board to accept their offer. Paramount launched a hostile tender offer, threatened a proxy fight and embarked on what the Financial Times describes as a full pressure campaign to bypass the board and appeal directly to shareholders.
All of this while David Ellison – a 43-year-old former aspiring actor propelled into the upper reaches of Hollywood power by his father’s $201 billion fortune – worked on assembling a “best and final” offer that those close to him dubbed, slightly absurdly, Project Warrior.
The sweeteners were significant: a higher price per share, a beefed-up break-up fee and, crucially, Larry Ellison personally backstopping the financing. That last element was decisive for WBD’s board, which had harboured doubts about whether Paramount could actually close a deal of this magnitude.
This is America in 2026 so there was, of course, another actor. Paramount cleared a crucial US antitrust hurdle, with the Department of Justice completing its second review without adverse finding. The decision was widely read as a signal from the Trump administration that it would not block the Paramount deal. The Ellisons are prominent Trump donors and supporters.
Netflix found itself in a more complicated position. Donald Trump had mused publicly in December that a Netflix-WBD combination could represent too dominant a market share in streaming and might be “a problem”. Then, at the Bafta awards in London, Netflix board member Susan Rice, a former national security adviser and UN ambassador under Barack Obama, made remarks critical of the administration that drew an angry response from the US president. The optics were unhelpful for a company trying to secure regulatory approval for the largest media merger in years.
Netflix executives insist regulatory concerns were not the primary reason they walked away. The deal, Sarandos said, was “always a ‘nice to have’ at the right price, not a ‘must have’ at any price”. Netflix shareholders, who had watched the company’s stock lose more than $60 billion in value during the months of deal speculation, had always been unenthusiastic about the whole idea.
What does any of this ultimately mean? The Ellison family will now control Warner Bros, HBO, CNN, CBS, Paramount Pictures and, intriguingly, the US operations of TikTok. That is a considerable concentration of cultural and media assets in the hands of people with close ties to a sitting president who is, by all accounts, less a consumer of Netflix dramas or HBO series than an obsessive viewer of America’s rolling news channels. CNN and CBS News may represent a tiny chunk of the combined business’s revenue, but their political sensitivity is entirely disproportionate to their financial weight.
Some media analysts argue this doesn’t matter that much: the deal will take the best part of two years to receive final regulatory approval, by which time Trump’s presidency will be winding down. Ownership changes rarely translate quickly into editorial transformation, they say.
That analysis misses the deeper point. This is the latest chapter in an accelerating story of consolidation of American media power in the hands of a small circle of billionaires with aligned political interests. The Ellisons now sit alongside Elon Musk at X, Jeff Bezos at Amazon and The Washington Post, and a range of other powerful figures in a dramatically reconfigured media ownership landscape. It would be naive to believe the consequences will not be profound.
