Paramount's David Ellison is launching a hostile takeover bid for Warner Bros. Discovery. Netflix is proceeding with its signed agreement to buy Warner Bros. and HBO. Shareholders and insiders are debating what should happen to the assets and what will. President Trump is saying he'll be "involved." And in a surprise twist this morning, he is blasting Paramount and the Ellisons, saying, "THEY ARE NO BETTER THAN THE OLD OWNERSHIP." The future ownership of CNN hangs in the balance.
Whew. I'm going to hit send now before any more news breaks.
Paramount's public $30-a-share offer was rolled out at 9 a.m. Eastern, sending WBD shares surging close to $28. The move is hardly surprising since Ellison put WBD in play by making unsolicited (and seemingly unwelcome) bids for the entire company several months ago. WBD CEO David Zaslav welcomed other bidders, Paramount perceived that he favored Netflix, and now here we are.
CNN's David Goldman has all the details about the Paramount offer in this story. "We're really here to finish what we started," Ellison told David Faber on CNBC. He argued that a Netflix-Warner combo would kill the movie theater industry, while a Paramount takeover of WBD would strengthen Hollywood. (His team simultaneously rolled out a shareholder campaign website, StrongerHollywood.com.)
In some ways, this argument really hinges on the value of WBD's old-fashioned cable assets, such as CNN and TNT. Paramount says both halves of WBD (which is planning to split into two) are worth $30 total. Netflix says the Warner Bros. and HBO half is worth $27.75, under the belief that the other half (to be called Discovery Global) "will be worth several dollars per share that will ultimately be worth more than Paramount's offer," Goldman wrote.
Ellison's response on CNBC: Discovery Global is worth $1 per share.
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CNN as a 'political football' |
CNN is undeniably a part of this corporate tug-of-war. When the Netflix deal was announced on Friday, the NYT wrote an entire story, titled "CNN, Unwanted by Netflix, Is Excluded From a Sale, for Now." John Koblin noted that some CNN staffers were worried about the prospect of a Paramount takeover. "With Netflix's apparent victory, CNN effectively ceases to be a political football," he wrote.
Now the "game" is back on. David Ellison has been both credited and criticized for forging ties with Trump's inner circle this year despite donating nearly $1 million to Joe Biden's reelection campaign last year. What some have seen as savvy business practices, others have seen as media capitulation.
Zaslav may have been channeling the latter camp when he pointedly said, in front of both Ellison and Sarandos at a glitzy gala in October, "When the government controls the news, that is the end of democracy." The context was about Poland, but some onlookers believed it was also a shot at Paramount's perceived appeasement of Trump.
A quick flashback is really helpful here. Back in 2017, when AT&T sought to buy CNN and the rest of Time Warner, Trump and his aides tried to influence CNN's coverage, knowing that the parent company needed the Trump admin's approval to merge. There was talk of potentially replacing CNN's president to placate Trump, and talk of Rupert Murdoch trying to buy CNN to achieve the same result.
But Time Warner management defended CNN's independence and did not interfere with or sell off the news channel. In fact, some sources told me that Trump's perceived meddling stiffened executives' spines. When the DOJ sued to block the deal, AT&T and Time Warner fought back in court and won. The merger went through. And now it's time for another mega-deal...
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What Ellison wants from CNN |
Perception is one thing, and reality is another. CBS News continues to cover Trump rigorously despite the perception of a cozy corporate relationship. This morning on CNBC, Ellison said of his aspirations to own CNN, "we've been really clear" about "what we want to do with news."
"We want to build a scaled news service that is basically, fundamentally, in the trust business, that is in the truth business, and that speaks to the 70% of Americans that are in the middle," Ellison said. For Paramount, that would be "doing well while doing good," he said. "We believe in that business model and we believe it's essential."
Faber asked, "Do you think the president embraces the idea of you being the owner of CNN, given his criticism, obviously, for that network?"
"We've had great conversations with the president about this," Ellison said, before cautioning that "I don't want to speak for him in any way, shape or form."
Last night, Ellison chatted with Trump at the Kennedy Center Honors in DC, shortly after Trump was asked about the Netflix bid on the red carpet. So let's get to that...
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Trump says 'I'll be involved' |
In response to a Q from Deadline's Ted Johnson, Trump confirmed that he recently met with Sarandos and called the Netflix co-CEO "a great person," while also expressing reservations about the combined market share of Netflix-Warners. In short, Trump kept his options open. The key quote: "I'll be involved in that decision."
What a stark contrast from 2017. When the Justice Department sued to block AT&T-Time Warner, Trump waved off questions about his involvement, saying, "I didn't make the decision." Now he boasts about being involved, wanting everyone to know.
Over the weekend, Bloomberg's Lucas Shaw wrote that Trump and Sarandos "struck up a bond" during dinner at Mar-a-Lago last December and "have remained in touch ever since."
In an Oval Office meeting last month, "Sarandos argued the merits of the Netflix-WBD deal, its absence of overlap, meaning less job losses, its ability to produce movies in the US, and that with competition from social media, the antitrust concerns" are "overblown," the NY Post's Charlie Gasparino wrote.
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To WBD, Netflix was the 'safer bet' |
Those stories provided further info about why Netflix initially triumphed. One of WBD's concerns, per Shaw, was Paramount's financing from Middle Eastern sovereign wealth funds.
And today's SEC filing by Paramount reaffirmed that "outside financing partners include funds from Saudis, Qataris, Emirates as well as Jared Kushner's Affinity Partners," Sara Fischer noted with a siren emoji. Kushner's firm and the foreign funds "have agreed to forgo any governance rights — including board representation — associated with their non-voting equity investments," the filing stated.
Also, WBD board members "were already put off by Paramount's unsolicited offer and the whispers around Hollywood and D.C. that only Ellison and his familial connections to the Trump White House would be able to secure regulatory approval for such a big merger," Variety's Cynthia Littleton wrote. Littleton's bottom line: Netflix was "the safer bet."
>> Meanwhile, Mike Cavanaugh, the soon-to-be co-CEO of the other bidder, Comcast, told the UBS media conference this AM that his company's bid for WBD's studio and streamer assets was comparatively "light on cash" and that "we didn't expect that we had a high likelihood of prevailing with a deal that made sense to us."
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🫨 Trump rails against Paramount |
While Ellison was speaking live on CNBC, Trump was composing a brutal anti-Paramount post. He raged against the company for airing a "60 Minutes" interview with Marjorie Taylor Greene. (Let's stop here and note that the MTG segment was newsworthy, timely and well-edited.)
Incredibly, Trump said he was angrier that "the new ownership of 60 Minutes" than at the "traitor" congresswoman. He wrote: "THEY ARE NO BETTER THAN THE OLD OWNERSHIP, who just paid me millions of Dollars for FAKE REPORTING about your favorite President, ME! Since they bought it, 60 Minutes has actually gotten WORSE!"
Some might be tempted to say this is kayfabe, a staged fight, meant to quell the talk of Paramount being in Trump's camp. I guess I'd just say: This is Trump being Trump, yelling at the TV, and CBS being CBS, covering the news the way it's supposed to be covered.
Meantime, many pro-Trump commentator types are pushing for him to trample all over Netflix's bid. Steve Bannon to Puck: "Gail Slater at Justice and the FTC should be all over this media consolidation—it’s out of control." Matt Gaetz on X: "TRUMP MUST STOP THIS!"
Some of the claims have been illogical lies tied to the right's usual bugaboos. Top MAGA influencer Jack Posobiec, for instance, repeatedly linked the deal to Netflix's production pact with Barack and Michelle Obama. "This is all about Obama taking over media," he claimed. It's not. Laura Loomer told her followers that if the sale goes through, Netflix will make sure CNN is "transformed into the Obama News Network." It won't be.
At the risk of repeating myself, Netflix isn't trying to buy CNN. But Paramount is. So if you're wondering what a hostile takeover bid means, read Elisabeth Buchwald's explainer for CNN.com here. She notes that Ellison's actions "most recently mirror those of Elon Musk," who fought to take over Twitter and won. "But this tactic doesn't always work."
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The ball is back in WBD's court |
On a 10:30 a.m. call, monitored by CNN's Liam Reilly, Ellison said "our proposal is superior to Netflix's in every dimension," including a "cleaner regulatory path" and more "pro-Hollywood, pro-consumer" position.
He hit Netflix hard over marketplace competition, suggesting a rollup of Netflix and HBO Max is inherently anticompetitive and can't be allowed. But Netflix is ready to refute Paramount's claims by pointing to Nielsen's measurement of the industry, which shows Netflix with 8% of total TV usage time, slightly under Paramount's 8.2%. Netflix ranks #6 on the Nielsen gauge, with YouTube #1 and Disney #2.
Netflix shares have dipped below the $1,000 mark this morning, trading down about 4%, while WBD is up about 5% and Paramount is up more than 7%.
WBD isn't commenting on the Paramount move yet. "You're only hearing one side of the story," an executive briefed on the bidding war said to me just now. "WBD is handling this by the book." Much more to come...
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Trump predicts "horrible" reviews but great ratings for his turn as host of the aforementioned Kennedy Center Honors. The event took place last night in DC, but we'll have to wait until Dec. 23 to watch it on CBS.
WaPo's Dan Diamond, who was in the theater, said Trump was "loose and funny," with only a modest amount of Joe Biden bashing and media trashing. "His delivery is far tighter and on-script than usual speeches," Diamond tweeted.
On CNN, I said the hosting gig was another example of what Politico's Jonathan Martin dubbed Trump's "adult fantasy camp," complete with "fun trips" and "lots of screen time." It was telling that Trump claimed Jimmy Kimmel was a "horrible" host, even though Kimmel, uh... never hosted the Kennedy Center Honors.
>> So how is the Trump-controlled Kennedy Center actually doing? CNN’s Betsy Klein has a new report about that.
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Cataloguing the 'chokehold' |
Nora Benavidez of the nonprofit advocacy group Free Press set out to catalog the Trump administration's First Amendment infringements. She soon had a list of almost 200.
The list is part of a new report, titled "Chokehold," about Trump and his administration's "war on free speech."
"While this chilling campaign is vastly unpopular and often loses in court, its speed and scale are unprecedented in U.S. history," Benavidez wrote. Before all the Paramount drama happened this morning, I wrote about the key takeaways from the report here...
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The 'affordability hoax' message |
Why does Trump keep asserting that real "affordability" concerns are a "hoax"? I'm sure you have your own answer to that question. Treasury Secretary Scott Bessent tried this answer on "Face the Nation" yesterday: "I think the president's frustrated by the media coverage of what’s going on."
When Margaret Brennan pointed out that polling shows genuine anxiety among everyday Americans, he said they're "hearing a lot of it from media coverage." Brennan's original question went unanswered: "Don't you need to show that you feel the pain?" TNR's Robert McCoy wrote about the exchange here…
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'Ad Spend to Grow More Than Expected in 2025' |
That's the headline from the WSJ's Megan Graham this morning. "Global ad revenue excluding U.S. political advertising will grow 8.8% in 2025 to $1.14 trillion,” per WPP, which raised its forecast "from the 6% it predicted in June," she wrote. Notable: "Tariffs didn’t take as big a bite as expected and AI provided a boost."
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Backlash to the Nuzzi backlash |
They said it was "in the best interest of the magazine." Vanity Fair and Olivia Nuzzi said Friday that they'd "mutually agreed" to let her short-term contract as West Coast editor expire.
No surprise there, of course. Nuzzi was far too much of a distraction. But we're firmly in the backlash-to-the-backlash cycle now: Air Mail published "In Defense of Olivia Nuzzi" by "Three Women" author Lisa Taddeo over the weekend. LA Times columnist Robin Abcarian predicted Nuzzi "will land on her feet." And Eric Michael Garcia, DC bureau chief for the Independent, wrote, "it's incredibly telling that she will lose her job, but RFK Jr. gets to stay in his job despite the reports of his drug use, his affairs and his defenestrating of public health."
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Over the weekend:
>> Trump called CNN's Kaitlan Collins "stupid and nasty" while misspelling her name. (The Hill)
>> Tucker Carlson got lots of attention for speaking at the Doha Forum and claiming that he's going to buy a house in Qatar to "make a statement." (Mediaite)
>> David Sims called HBO Max's "Mad Men" 4K remaster debacle "a strange cautionary tale." (The Atlantic)
>> Dylan Byers reported that Bari Weiss and Tom Cibrowski have lured ABC correspondent Matt Gutman to CBS "after a protracted back-and-forth negotiation." (Puck)
>> Peter Kafka talked with PBS CEO Paula Kerger about the future of public broadcasting. (Business Insider)
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AI's persuasion power/problem |
Artificial intelligence chatbots "are very good at changing people’s political opinions," and are "particularly persuasive when they use inaccurate information," a paper published in the journal Science has found, per NBC's David Ingram.
>> The researchers wrote that "the most persuasive models and prompting strategies tended to produce the least accurate information."
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>> Last night's "60 Minutes" reported how Character AI bots "engaged in predatory behavior with teens, families allege." (CBS)
>> An important piece by Max Tani: "AI critics funded AI coverage at top newsrooms." (Semafor)
>> Katie Miller taped a chat with Elon Musk for her podcast; it's coming out tomorrow night.
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Golden Globes noms are here |
The Golden Globes nominations were announced this morning, and "One Battle After Another" led the pack with nine nods, followed closely by "Sentimental Value" with its eight nominations.
The first-ever Best Podcast nominees were revealed: Armchair Expert with Dax Shepherd, Call Her Daddy, Good Hang with Amy Poehler, The Mel Robbins Podcast, Smartless, and Up First. The Globes will air on CBS on Sunday, Jan. 11. CNN's Choire Sicha has the full list here...
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>> Universal's "Five Nights at Freddy’s 2" zoomed past Disney's "Zootopia 2" over the weekend. (CNN)
>> Paul Thomas Anderson's "One Battle After Another" was “the darling of the Los Angeles Film Critics Association, taking home three prizes last night. (Variety)
>> Taylor Swift's "The Life of a Showgirl" has returned to No. 1 on the Billboard 200 albums chart. (Billboard)
>> And speaking of Swift, the first two episodes of her "End of an Era" docuseries land this Friday.
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