The Open Markets Institute, an organization dedicated to stopping monopolies, is calling on U.S. regulators to oppose any attempt by Paramount-Skydance to acquire Warner Bros. Discovery following Netflix’s decision to walk away from its previous deal to obtain the studio.
Netflix dropped its bid Thursday after declining to raise its offer to counter Paramount’s higher bid, paving the way for Paramount to advance its own offer.
The antitrust alarm bell has been rung a few times since the start of the bidding war, prompting lawmakers and organizations to scrutinize potential monopolization.
Courtney Radsch, director of Open Markets’ Center for Journalism and Liberty, said Friday in a statement that further consolidation of this industry would “deepen already dangerous concentrations of power over film, television, news, and information.”
The multitude of concerns includes fewer films produced, limited movie theater exclusivity due to direct-to-streaming releases, reduced investment in large-scale productions, raising licensing fees and subscription prices, weakening competition for creative talent and raising barriers to entry.
“Allowing Paramount to absorb Warner Bros. Discovery would further entrench a system that suppresses competition, undermines independent journalism and creative labor, and narrows the range of voices and viewpoints available to the public,” Ms. Radsch said.
Federal regulators, including the Justice Department’s antitrust division, need to approve the deal and evaluate concerns about a monopoly-like power in the marketplace.
David Ellison, the Paramount CEO, has close ties with the Trump administration, prompting political scrutiny since President Trump said he would “be involved” in the outcome of the deal.
Skydance acquired Paramount last year, a deal approved by the Trump administration after the company agreed to pay $16 million to settle a lawsuit brought by the president against “60 Minutes,” the news program of Paramount broadcaster CBS.
Allegations emerged that the White House was meddling in the potential acquisition of Warner Bros. by explicitly favoring a rival bid from Paramount.
Mr. Trump publicly signaled his opposition to Netflix’s bid for Warner Bros., demanding that Netflix fire former Obama-era official Susan Rice from its board or “pay the consequences.”
Netflix reached an agreement with Warner Bros. to acquire its studio and streaming assets for $82.7 billion in December, but Paramount made an unsolicited, hostile bid three days later worth $108.4 billion and continued to increase its offer. That offer was officially solidified at $111 billion Thursday.
Netflix co-CEO Ted Sarandos met with administration and Justice Department officials Thursday to ensure a fair regulatory review of the prospective acquisition.
“This is not normal market behavior. It raises serious concerns about whether decisions shaping the nation’s information infrastructure are being influenced by political pressure rather than law, fair competition, or the public good,” Ms. Radsch said.
• Mary McCue Bell can be reached at mbell@washingtontimes.com.
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