Brendan Carr, the chairman of the FCC appointed by Trump, recently expressed concerns about Netflix’s intent to acquire Warner Bros. for $83 billion. He highlighted that this merger could raise “competition concerns.” However, it’s important to note that the FCC doesn’t have the power to review this deal. Warner Bros. does not hold any broadcast licenses that the FCC regulates, and Netflix isn’t interested in WBD’s cable assets.
In an interview with Bloomberg, Carr praised Netflix’s growth but acknowledged valid worries about market consolidation. Meanwhile, the Justice Department and the FTC are responsible for examining this potential merger for antitrust issues.
Paramount Skydance, led by David Ellison, is also in the race, pushing a $30 per share bid for Warner Bros. Carr noted that if Paramount’s deal goes through, there wouldn’t be as many competition concerns given that its funding comes from various foreign investments. This includes significant backing from Larry Ellison, David’s father, and sovereign funds from Saudi Arabia, Qatar, and Abu Dhabi.
In a surprising move, Netflix switched to an all-cash offer for Warner Bros. to strengthen its position against Paramount. Both companies have filed necessary documents with regulatory authorities and plan to work closely with them.
As the situation unfolds, Paramount has argued that Netflix’s acquisition could hurt competition. They claim that the combined Netflix and HBO Max might control up to 43% of the global streaming market. This, they argue, could lead to higher prices for viewers and less money for content creators.
Politicians are also weighing in. Senator Elizabeth Warren described the merger as an “anti-monopoly nightmare.” Netflix’s co-CEO Ted Sarandos and Warner Bros. chief strategy officer are set to testify at a Senate antitrust hearing next month. Senator Mike Lee highlighted the potential red flags in the merger, signaling an intense debate ahead.
In its defense, Netflix frames its competition broadly, noting that they compete for viewers’ attention not just with other streaming services but also with platforms like YouTube and Instagram. Despite their success, Netflix claims their TV viewing time is still less than 10% in major markets.
Carr’s tenure at the FCC has already seen controversy. He’s previously been vocal about media practices, even threatening investigations into networks like ABC over what he calls “news distortion.” Recently, the FCC reminded networks that late-night shows, which often employ political humor, could be subject to equal airtime rules.
With such a complex mix of interests at play, the outcome of the Netflix-Warner Bros. deal remains uncertain. As the streaming landscape evolves, the implications of these mergers will likely shape how we watch and pay for content in the future.
For more on regulatory impacts on media companies, check out recent analysis by the Brookings Institution.
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Brendan Carr,FCC,Netflix,Warner Bros. Discovery
