Paramount to buy Warner Bros as Netflix walks away from the deal

A few months back, it seemed Netflix has bought Warner Bros, subject to approvals, process and several months of finalisation. Cue Paramount’s intervention, a few rounds of offer clarification and a refusal to back down. The net result — Netflix has opted to pull out of further rounds of bidding and walk away from the deal.

Paramount “wins” the bidding — what do we know

Trying to stick purely to facts, here’s a press release from Paramount as it seemed their latest offer for Warner Bros has tipped the process in their favour. Netflix decided enough was enough (and the price was possibly higher than they could justify paying) and they pulled out with this press release. Whatever the details, the stock market has taken the decision positively (short term at least) and the Netflix share price jumped around 10%.

What might this mean

We’ve long since felt most consumers need more consolidation in the market and reasons to avoid hopping between subscriptions to catch shows. While some cross-licensing happens, it’s not the same as just having a huge library of content.

For Netflix, we can see them having interest in other back-catalogue building acquisitions, though maybe smaller. For Paramount, it seems there’s many months worth of activity to conclude. The BBC has some relevant analysis, looking wider than our focus on streaming. They align with our thoughts this means (a lot) more content for Paramount+ subscribers, probably price hikes and a three-way split with Netflix and Disney+, the market price set by Netflix.

We expect a lot more information once the US regulator (and Europeans) approve the deal. Until then, we’ll focus on the shows there now.