Who paid?
Something that can both help and kill David Ellison’s purchase are the financiers behind the $110 billion bid – which ultimately won the bidding war against streaming giant Netflix.
It has been known for months that President Donald Trump’s son-in-law, Jared Kushner, was financially involved in the deal. The Trump family’s investments and good relations between the Ellison and Trump families could make it easier for the purchase to move through American bureaucracy.
Analysts at investment firm Raymond James assess Paramount-Skydance’s “political position with the current American administration as much stronger than that of Netflix” and believe that this gives the company a better chance of getting the deal approved, according to American broadcaster CNBC.
The money also came from sovereign wealth funds in Saudi Arabia, Abu Dhabi, the United Arab Emirates and Qatar. Paramount-Skydance has assured that in these cases these investments do not mean gaining influence over the company or representation on the board.
Nevertheless, the regulation was criticized. California Attorney General Rob Bonta, a Democrat, said the state’s Justice Department had opened a review of the matter and said it would “move diligently in its review.”
Does the company comply with competition laws?
The lawsuit against US competition laws could ultimately end up more or less on President Donald Trump’s desk, as the Justice Department is the final authority in the process.
If the deal goes through, the company will not only gain control of two of America’s largest news networks – CNN and CBS – but also two of the country’s most popular streaming services – Paramount + and HBO Max. But also several franchise films and series such as Star Trek, Harry Potter and Friends, which will be part of Ellison’s new empire.
Both Warner Bros. and Paramount-Skydance will likely have to make “significant concessions” to allay concerns about a monopoly in the U.S. media market, believes Paren Knadjian, partner at management consulting firm EisnerAmpe.
“This is much more complicated than most deals we’ve seen before,” he told CNBC.
The question of a media monopoly is becoming more pressing as Larry Ellison, software billionaire and supportive father of David Ellison, recently acquired part of Tiktok in the US. And it’s not just media revenue that the family is gaining control over.
– Beyond all the dollars they can make, it’s data about customers’ habits, down to the individual level, says Jon Klein, former head of CNN and CBS in the American Civil Service.
What will it be like for viewers?
“Game of Thrones,” “Sex and the City,” “The Sopranos,” “The Pit,” and “Succession.” A whole series of audience hits come together if Paramount + and HBO Max get the same owner.
What the business models might look like and what impact they will have on viewers is still unclear, but there are two main theories.
According to analysts the BBC spoke to, merging or combining streaming services Paramount+ and HBO Max into one subscription could give viewers more content for their money. The deal should reduce streaming costs to some extent, especially for those who already have both subscriptions today.
But it can also have the opposite effect.
With a more attractive option, Paramount-Skydance may have more room to increase prices. And the dissatisfied consumer then has fewer services to choose from.
Massachusetts Democratic Sen. Elizabeth Warren called the deal a “competition disaster that could lead to higher prices and fewer choices for American families.”
Price increases are still expected to be limited by Netflix, which still uses its power to play a pricing role in the streaming market.
But even television analyst Tom Harrington sees the danger that the merger will lead to higher prices for viewers.
– There would simply be less competition, says Tom Harrington to BCC and continues:
– Then it is possible to withdraw a little more.
Read more:
Trump-friendly media giant buys Warner – worries about future of CNN
