In a landmark move that could reshape the global media landscape, streaming behemoth Netflix has clinched a staggering $72 billion deal to acquire Warner Bros. Discovery's studios and its HBO Max streaming service. The agreement, finalized on December 6, 2025, saw Netflix outbid rivals Paramount and Comcast. However, the celebratory mood is now tempered by the looming prospect of a fierce antitrust battle with the Trump administration.
The Regulatory Hurdle Ahead
The U.S. Justice Department has already initiated scrutiny of the proposed merger, concerned it could further cement Netflix's dominance in the media industry. The investigation is expected to be lengthy, typically taking at least 10 months before any potential legal challenge. Adding a political dimension, President Donald Trump's preferences could significantly influence the outcome. Trump is known to be close with Paramount Chief Executive David Ellison and his father, Oracle co-founder Larry Ellison, a Trump ally. This relationship could pressure antitrust enforcers to steer the Warner assets toward Paramount instead.
A senior administration official confirmed on Friday that Trump advisers, including White House officials, are concerned about Netflix's deal. Paramount, which saw its shares slump after losing the bid, has accused Warner of unfairly favoring Netflix and suggested regulators in the U.S. and abroad would frown upon the transaction. The company is now weighing its next steps.
Arguments For and Against the Mega-Merger
Netflix co-CEO Ted Sarandos expressed "high confidence" that the deal will win approval, calling it "pro-consumer" and "pro-innovation." The company argues the acquisition of Warner's vast libraries and the HBO brand will help attract and retain subscribers. Netflix has pledged to keep Warner Bros. and HBO producing shows and movies, which it says benefits the creative community. Post-merger, HBO and HBO Max would operate as standalone entities but be bundled and sold separately alongside Netflix, potentially offering lower prices to consumers.
However, antitrust concerns are substantial. Netflix and HBO Max combined would control approximately 30% of the U.S. subscription streaming market. Under Justice Department guidelines from 2023, retained by the Trump administration, mergers of direct competitors are presumed illegal when market share exceeds 30%. Some within the DOJ already believe the deal might violate antitrust laws due to the combined entity's scale.
Netflix counters that the relevant market should include free platforms like YouTube and TikTok. Even within the subscription sphere, Netflix believes there's no evidence the deal would reduce competition or harm consumers.
Political Pressure and Industry Backlash
The deal's fate may hinge on the White House's influence, which is seen as more pronounced in this administration. During Trump's first term, the DOJ unsuccessfully challenged AT&T's acquisition of Time Warner after Trump criticized CNN, a Time Warner property. In contrast, the administration recently approved Skydance Media's merger with Paramount.
The current antitrust chiefs, Gail Slater at the DOJ and Andrew Ferguson at the FTC, have focused on cost-of-living sectors like healthcare. Companies have recently secured approvals by offering settlements, such as selling business parts to third parties.
Netflix's confidence is underscored by its agreement to pay a record-breaking $5.8 billion breakup fee—about 8% of the deal value—if regulatory approvals fail. The companies anticipate a 12 to 18-month closing process. Both sides have hired legal heavyweights: Netflix enlisted Skadden's Steven Sunshine, while Paramount brought on Makan Delrahim, who ran the DOJ's antitrust division under Trump.
The deal has sparked bipartisan concern in Congress. Senator Elizabeth Warren (D-Mass.) labeled it an "anti-monopoly nightmare," while Senator Mike Lee (R-Utah), who leads a key antitrust subcommittee, said it raises the most serious competition questions he's seen in a decade. The movie exhibition industry also fears Netflix's historical preference for direct-to-platform releases could threaten theatrical distribution, despite Netflix's assurances to maintain Warner Bros.' current operations.
