Simply extraordinary stuff coming out this morning about the battle over what used to be Time Warner and now goes by the name Warner Bros Discovery (which includes CNN in addition to the more lucrative media stuff). The company had agreed to be acquired by Netflix. So Paramount — now the vehicle of the Ellison family successor and a Trump state media entity-in-the-making — has launched a hostile takeover effort to swoop in and gobble up WBD for itself. In its public pitch, it has openly advertised to shareholders that it is the better acquirer because the Ellisons are tight with Trump, and the White House will never let a Netflix deal go through. Trump, in comments yesterday, as much as agreed. Trump has refashioned antitrust oversight to be little more than a personal veto for the Trump family. Friends can do mergers; foes can’t. Indeed, the indifferent and uncommitted can’t either. You need to get right with the Trump family.
When you ask why so much of corporate America is beholden to Trump now, this is why. A big diversified corporation simply cannot compete and thus, in practice, can’t exist with a determinedly hostile administration.
Now we learn this: who else is part of the hostile takeover bid? None other than Jared Kushner. Yes, Jared — international M&A man when he’s not cutting “peace” deals in Israel-Palestine or Ukraine. And wait, there’s more! Just moments ago I saw that it’s not just Jared: the Saudis, Qataris and Emiratis are also in on the deal. Backstopping the deal is a fund, RedBird Capital, seen by many as a stalking horse for China.
My main interest in all of this is narrow and specific: the fate of CNN. The outlook for the institution seems bleak over time. Netflix, as I understand it, doesn’t care about it and doesn’t want it. In economic terms it’s an afterthought, if not a liability. This is really about the streaming wars and to a secondary extent the content-producing entities that feed it. But Paramount does want CNN because either neutering it on behalf of Trump (´à la CBS) or turning it into a Fox News competitor is part of its alliance with Trump, and more general commitment to oligarchic rule in the U.S.
When I say CNN’s outlook looks bleak in general, it’s because no company looking to run it as a business has much interest in acquiring it. It’s not some huge profit center. And owning it is a major liability inasmuch as allowing it to run as anything like a legitimate news operation almost guarantees Trump harassment. The companies that have a strong interest in acquiring it are those who want to Fox-ify it as a favor to Trump and reap secondary benefits from doing that favor even if they lose money on CNN itself. So it’s hard to see how these incentives lead to anything good even if Paramount doesn’t manage to grab it in this round.
