Warner Brothers Discovery — the parent company of CNN and HBO Max is considering a sale amid unsolicited interest in the company marking the latest shake up across US legacy media.
The New York City based media conglomerate announced the possible sale on Tuesday.
Several major media giants have reportedly expressed interest. Netflix and Comcast are said to be interested parties according to CNBC which cited unnamed sources familiar with the deal. That follows interest from Paramount-Skydance.
In June, Warner Bros Discovery announced it would split Warner Bros and Discovery Global units separating its streaming businesses from its cable network unit. The company has doubled down in the streaming space in recent weeks. On Thursday, CNN announced a new subscription streaming service called CNN All Access – two years after CNN+ — its short-lived streaming platform — shuttered.
A sale or a split would be one of the most consequential reshaping moments in the media industry, potentially prompting other legacy media houses to revisit their own structures. Streaming has fundamentally reshaped the media industry, leaving traditional broadcasters with mounting debt, higher content budgets and fragmented viewership.
“This latest development potentially opens up further discussions with interested parties. For Hollywood and other traditional media giants, all roads lead to consolidation,” PP Foresight analyst Paolo Pescatore said.
The company is also considering an alternative separation structure that would enable a merger of Warner Bros and a spin-off of Discovery Global.
The Ellison in the room
Warner Brothers Discovery already rejected an initial bid from Paramount — now led by David Ellison, the son of Larry Ellison, cofounder of Oracle and a key ally of US President Donald Trump — Bloomberg News reported earlier this month, because the offer of around $20 per share was too low.
Skydance’s advances soon after snapping up Paramount speak to the Ellison family’s voracious appetite to dominate the global media landscape amid a favourable regulatory regime in the United States.
Analysts believe David Ellison’s deep pockets – backed by his father, Oracle cofounder and the world’s second-richest person Larry Ellison – give him the firepower to take the risk.
The elder Ellison’s close ties with US President Donald Trump may also smooth regulatory hurdles and avoid the scrutiny that would usually come with such a merger, analysts say.
The decline of legacy media, driven by linear TV cord-cutting, as well as the shift of audiences and advertisers to streaming platforms, has forced traditional media companies to rethink their business structures.
Ellison’s looming involvement raised concerns about how CNN could cover the White House.
Among the vocal critics is Dan Rather, who served as the anchor of the CBS Evening News for 24 years.
“Americans have to be concerned about the consolidation of huge billionaires getting control of nearly all of the major news outlets,” Rather said in an interview on Andy Cohen’s SiriusXM show in September.
“It’s pretty hard to be optimistic about the possibilities of the Ellisons buying CNN.”
Before the Paramount – Skydance Merger, CBS settled a lawsuit that alleged that the network’s long-standing newsmagazine 60 Minutes deceptively edited an interview with then Democratic Presidential hopeful Kamala Harris for $16m. And also ahead of the merger announced the cancellation of the Late Show with Stephen Colbert, who only days before called the settlement “a big fat bribe”.
Ellison has since hired Bari Weiss — an opinion writer and founder of the commentary website Free Press. Weiss, who had no experience in television — to lead the broadcast TV network. Weiss has gained popularity among right-wing voices for her “anti-woke” commentary.
This as the company appointed Kenneth Weinstein, a former Trump administration nominee, to be CBS News’ ombudsman to investigate allegations of bias.
On Wall Street, Warner Bros Discovery is up 10.8 percent following the announcement. Comcast is up 0.1 percent, Netflix is up 0.7 percent. Paramount-Skydance, on the other hand, is trending downwards — down 1.3 percent from the market open as of 11:30 AM in New York (15:30 GMT)
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