Business
The regulatory path ahead for a Netflix and Warner Bros. deal could get dicey
Logos of Netlfix and Warner Bros.
Reuters
The Netflix and Warner Bros. Discovery deal came together quickly — but its path to regulatory approval may not be so speedy.
Netflix stunned the media industry on Friday when it announced its proposed $72 billion deal to acquire the iconic Warner Bros. film studio and streaming service HBO Max. The combination brings together two of the most popular streaming platforms in the business. Netflix reported 300 million global subscribers as of late 2024, the last time it reported the metric. HBO Max had 128 million customers as of Sept. 30.
Netflix currently claims 46% of mobile app monthly active users in global streaming, according to data from market intelligence firm Sensor Tower. Combined with HBO Max, that share would rise to 56%, it found.
“This deal cements Netflix’s position as the premier streaming service for original content,” according to a research note from analysts at William Blair on Friday.
The size of the deal makes it ripe for scrutiny, from both industry insiders and U.S. lawmakers.
The Trump administration is viewing the merger with “heavy skepticism,” CNBC reported Friday, and Sen. Elizabeth Warren has already called for an antitrust review.
“This deal looks like an anti-monopoly nightmare. A Netflix-Warner Bros. would create one massive media giant with control of close to half of the streaming market — threatening to force Americans into higher subscription prices and fewer choices over what and how they watch, while putting American workers at risk,” Warren, a Democrat from Massachusetts, said in a statement.
The merger would also give Netflix control over the famed Warner Bros. film studio, further consolidating the cinematic space and raising concerns that the number or typical windowing of popular releases could shrink.
It’s typical in the days and weeks following a deal announcement of this scale for interest groups, politicians and corporate competitors to call foul on antitrust grounds.
The Department of Justice is most likely to review the deal, as it has other media mergers in the past, and it could take some time. DOJ reviews can take anywhere from months to more than a year.
Netflix said Friday it expects the transaction to close in 12 to 18 months, after Warner Bros. Discovery spins out its portfolio of cable networks into Discovery Global.
Netflix confidence
Ted Sarandos, co-chief executive officer of Netflix , attends the annual Allen & Co. Media and Technology Conference in Sun Valley, Idaho on July 11th, 2025.
David A. Grogan | CNBC
Netflix executives on Friday said they were “highly confident” the deal would win regulatory approval.
“You know, this deal is pro-consumer, pro-innovation, pro-worker, it’s pro-creator, it’s pro-growth,” Netflix co-CEO Ted Sarandos said during an investor call following the acquisition announcement.
“Our plans here are to work really closely with all the appropriate governments and regulators, but [we’re] really confident that we’re going to get all the necessary approvals that we need,” Sarandos added.
As part of the deal, Netflix has agreed to pay a $5.8 billion breakup fee to Warner Bros. Discovery if the deal were to get blocked by the government.
Netflix’s bid won out over competing offers from Paramount Skydance and Comcast.
Analysts at Deutsche Bank and William Blair were at least minimally convinced Friday of the potential for the deal to go through.
“A merger of Warner Bros. Discovery and any of the three bidders would probably succeed, even if the DOJ were to sue to block a proposed combination,” Deutsche Bank analysts wrote in a note on Friday, citing insights from a Department of Justice veteran who the analysts said “does not see any significant antitrust problems with any of the three scenarios.”
“However … we don’t know all of the detailed facts that will be collected and analyzed by the DOJ, nor do we know who the judge hearing the case will be, and both of these factors can have an impact on the outcome,” the Deutsche Bank analysts noted.
Paramount, for its part, has been fanning the flames.
Paramount’s lawyers sent a letter to Warner Bros. Discovery this week, first reported by CNBC, in which it argued the sale process had been rigged in Netflix’s direction. The Wall Street Journal reported that in a separate letter, Paramount said a Netflix transaction would likely “never close” because of regulatory headwinds.
Paramount was the only bidder looking to buy WBD’s massive portfolio of pay-TV networks — and it’s unlikely to walk away from the process quietly.
Not so fast
Oracle co-founder, CTO and Executive Chairman Larry Ellison (C), U.S. President Donald Trump, OpenAI CEO Sam Altman (R), and SoftBank CEO Masayoshi Son (2nd-R), share a laugh as Ellison uses a stool to stand on as he speaks during a news conference in the Roosevelt Room of the White House on January 21, 2025 in Washington, DC. Trump announced an investment in artificial intelligence (AI) infrastructure and took questions on a range of topics including his presidential pardons of Jan. 6 defendants, the war in Ukraine, cryptocurrencies and other topics.
Andrew Harnik | Getty Images
Wall Street expected President Donald Trump’s second term to usher in a windfall of dealmaking. However, economic uncertainty has slowed the process for some companies, and regulatory holdups have played a bigger role than anticipated.
“Under Donald Trump, the antitrust review process has also become a cesspool of political favoritism and corruption,” Warren said in Friday’s statement. “The Justice Department must enforce our nation’s anti-monopoly laws fairly and transparently — not use the Warner Bros. deal review to invite influence-peddling and bribery.”
Paramount’s merger with Skydance was left in limbo for more than a year before it finally won federal approval in July.
The Federal Communications Commission (which is unlikely to review the Netflix-WBD tie-up since it doesn’t involve a broadcaster) signed off on the $8 billion merger shortly after Paramount agreed to pay $16 million to Trump to settle a lawsuit over the editing of a “60 Minutes” interview with former Vice President Kamala Harris. Paramount had also ended its diversity, equity and inclusion policies earlier in the year after the FCC said it would investigate the company over its DEI programs.
In September, the newly combined Paramount Skydance, run by David Ellison, set its sights on Warner Bros. Discovery. The company is now considering whether to take a hostile bid straight to WBD shareholders and try to unseat Netflix as the would-be buyer, CNBC reported Friday.
Ellison’s billionaire father, Oracle co-founder Larry Ellison, is known to be close with Trump.
The argument for whether to clear Netflix’s proposed takeover of Warner Bros. would likely come down to questions around streaming — first, on pricing for consumers, and second, on how to define Netflix’s audience.
The pricing of streaming subscriptions has risen across the board in recent years. In 2022 Netflix instituted a cheaper, ad-supported model after years of resistance in an effort to beckon more customers. The following year, Disney followed with its own more-affordable plan.
Netflix is used to upending the legacy media industry. The company ended its DVD rentals business in 2023 and went all in on streaming. It’s since found massive scale and has taken over the zeitgeist with original series like “Squid Game,” “Wednesday,” “Stranger Things,” and “Bridgerton.”
Its maverick approach to media and its broadening foothold in the industry may be its saving grace in the eyes of regulators.
“My expectation on the regulatory side is Netflix is going to advocate and argue with their advisors for a very expansive definition of what their market is … so that would include broadcast, cable, subscription and ad-supported streaming,” said said Jeff Goldstein, a partner and managing director at AlixPartners, and co-lead of the U.S. Media group.
“And really, really, really importantly, that would include YouTube,” he said.
YouTube has come to dominate the industry when it comes to viewership. Nielsen once again reported in October than YouTube had the largest share of TV usage, with Netflix in sixth place and Warner Bros. Discovery in seventh place. Traditional media companies with linear networks — Disney, NBCUniversal, Fox and Paramount — filled the spots in between.
Critics of the deal will define Netflix’s reach more narrowly to try to demonstrate outsized dominance, said Goldstein.
“I believe that streaming is not a category. Television viewership is a category … you know, eyeballs might be a category,” media industry titan John Malone told CNBC in November when asked about antitrust questions surrounding the WBD sale process.
“But if you’re going to broaden the category to that, you got to take in YouTube and Facebook and the social networks, TikTok,” he said. “I mean, that’s really the question, is streaming a category? … Are studios a category … and is that going to get looked at hard? These regulatory things are a little bit difficult to predict.”
— CNBC’s Julia Boorstin contributed to this report.
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become the new parent company of CNBC upon Comcast’s planned spinoff of Versant.
Supermarket Morrisons has revealed annual losses of £381 million after hefty borrowing costs but enjoyed a resurgent sales performance over Christmas.
The UK’s fifth largest grocery chain reported a £381 million pre-tax loss for the year to October 26 after it faced a £281 million interest bill on its debt mountain, although it said this was narrowed from losses of £414 million in 2023-24.
The group – owned by US private equity firm Clayton, Dubilier & Rice – said it cut debts by 10% over the year, but still ended 2024-25 with a £3.1 billion debt pile.
Morrisons added that on an underlying basis and stripping out costs such as debt interest, its earnings remained flat at £835 million, with progress held back by rising costs and a cyber incident that caused an IT systems outage just before Christmas 2024, impacting product availability.
The group said measures in the 2024 budget, such as last April’s national insurance contributions tax hike and minimum wage rise, sent costs surging by £200 million in the past financial year.
It said it cut costs by £233 million in the year to October 26 and is making further savings over the current financial year to meet its £1 billion target.
This is not set to include job losses among its 95,000-strong workforce, although bosses said the group would not replace some workers as they left in an effort to make savings and as it rolls out initiatives such as electronic shelf price tags.
Over Christmas, the firm said like-for-like sales growth picked up to 3.4% in the crucial six weeks to January 4, helped by strong demand for its own-brand premium range, which saw sales jump 17.4%.
It cheered a “good performance in a competitive market”, with non-food sales also up 10% and its clothing range seeing a 4.7% increase over the Christmas period.
The festive sales jump marked an improvement on trading in the full year to October, when like-for-like sales lifted 2.8%, with growth slowing to 2.4% in the final quarter.
Rami Baitieh, chief executive of Morrisons, said: “In a year when consumers were feeling the squeeze, we grew like-for-like sales for a 12th consecutive quarter, maintained Ebitda (earnings before interest, taxes, depreciation, and amortisation) and our market share.”
He said the results “demonstrated our resilience in the face of some tough external headwinds, from the cyber incident, rising inflation and Government cost increases, which we worked hard to offset”.
Mr Baitieh added: “We had a good Christmas in 2025, providing a solid foundation for the first quarter.
“As we enter 2026, the grocery market remains competitive and we are committed to our focus on delivering good value and keeping prices low for customers.”
He said consumers were under pressure at the end of last year, with “the impact of the Government cost increases, with inflation and budget uncertainty all weighing on customer sentiment” and added consumer confidence was still “not at its best” in 2026.
Recent industry data from Worldpanel suggested Morrisons’s market share slipped over Christmas, to 8.5% in the 12 weeks to December 28, down from 8.6% a year earlier despite the sales rise.
The gap with rival Lidl is closing and experts have said the German discounter could overtake Morrisons in the coming months if its current momentum continues.
Morrisons said it cut costs and borrowings in the year to October 26, with its debt now down by 46% from a peak seen in 2022.
Jo Goff, chief financial officer of Morrisons, said: “We worked hard during the year to offset the significant and unexpected cost headwinds arising from the Government’s 2024 budget and other inflationary pressures, with our cost reduction programme delivering savings of £233 million, to take the total to date to £845 million.
“We expect to exceed our £1 billion savings target by the end of 2025-26.”
Business
EU–Mercosur trade pact: Parliament sends deal to EU court, farmers celebrate while exporters flag risks – The Times of India
The European Parliament has voted to refer the recently signed EU-Mercosur free trade agreement to the bloc’s top court, pushing the long-negotiated pact into legal uncertainty just days after it was sealed, according to an AFP report.Lawmakers in Strasbourg voted 334 to 324 in favour of asking the Court of Justice of the European Union (CJEU) to examine whether the agreement complies with EU rules. The move follows the signing of the deal on Saturday with Brazil, Argentina, Uruguay and Paraguay, aimed at creating one of the world’s largest free trade areas.
The decision was greeted with celebration by farming groups, particularly from France, which has led opposition to the pact over concerns about agricultural imports. Hundreds of farmers gathered with tractors outside the European Parliament ahead of the vote and cheered as the result was announced.“We’ve been on this for months and months, for years,” Quentin Le Guillous, head of a French young farmers’ group, told AFP. “Tonight, I’m going home, I’m going to kiss everyone, and I’m going to tell my kids, ‘I got it, we got it, we can be proud.’”The court referral deals a setback to the European Commission, which negotiated and champions the agreement. Commission President Ursula von der Leyen had earlier described the pact as a “historic deal,” especially at a time when countries are seeking new trade partners amid tariff threats from the US administration.The Commission said it “regrets” the parliament’s decision. Trade spokesman Olof Gill said the questions raised by lawmakers were “not justified,” arguing that the Commission had already addressed concerns in detail.At the heart of the legal challenge is whether the agreement can be partially applied before full ratification by all EU member states, and whether it improperly limits EU powers on environmental and food-safety standards.The decision also drew criticism from industry. Hildegard Mueller, head of Germany’s auto industry group VDA, said the vote sent a “devastating sign” and risked alienating Mercosur partners at a time of heightened geopolitical uncertainty.Germany, Spain and Nordic countries back the deal, viewing it as a way to boost exports amid competition from China. German Chancellor Friedrich Merz said after the vote: “We are convinced of the legality of the agreement. No more delays. The agreement must now be provisionally applied.”However, France, Poland, Austria, Ireland and Hungary remain opposed, citing risks to domestic agriculture. French Foreign Minister Jean-Noel Barrot said, “The fight continues to protect our agriculture and guarantee our food sovereignty.”The EU-Mercosur deal would ease tariffs on more than 90 per cent of bilateral trade, favouring European exports such as cars, wine and cheese, while opening EU markets further to South American beef, poultry, sugar and soy.Together, the EU and Mercosur account for around 30 per cent of global GDP and more than 700 million consumers.
Getty ImagesUS President Donald Trump has threatened to impose further tariffs on eight European allies who oppose his demands for control of Greenland.
In 2025, he placed a number of taxes on goods reaching the US from countries around the world, arguing that the move would boost American manufacturing and create jobs.
Critics warned of higher prices and damage to the global economy, and the US Supreme Court is considering the legality of the tariffs Trump has brought in.
What are tariffs and how do they work?
Tariffs are taxes on imported goods.
Typically, the charge is a percentage of a good’s value.
For example, a 10% tariff on a $10 product would mean a $1 tax on top – taking the total cost to $11 (£8.17).
The tax is paid to the government by companies bringing in the foreign products.
These firms may pass some or all of the extra cost on to their customers, which in this case means ordinary Americans and other US businesses.
They may also decide to import fewer goods.
Why is Trump using tariffs?
Trump says tariffs increase the amount of tax raised by the government, encourage consumers to buy more American-made goods and boost investment in the US.
He wants to reduce the US trade deficit – the gap between the value of goods it buys from other countries and those it sells to them.
The president argues that the US has been exploited by “cheaters” and “pillaged” by foreigners.
He said that China, Mexico and Canada must do more to stop migrants and the illegal drug fentanyl reaching the US.
Trump has also used the threat of tariffs to encourage other countries to support the US on issues unrelated to trade – Russia’s invasion of Ukraine and Iran’s suppression of protests, as well as his demands on Greenland.
Many tariffs have been amended or delayed after being announced.
How will the new tariffs on eight European countries work?
On 17 January, Trump threatened to impose a further 10% tariff on eight European countries who have rejected his Greenland plans.
He said the rate would apply to goods from Denmark, Norway, Sweden, France, Germany, the UK, the Netherlands and Finland from 1 February, but could later rise to 25% – and would last until a deal was reached.
The move was widely condemned by European leaders, including UK Prime Minister Sir Keir Starmer and French President Emmanuel Macron, who said the EU could consider a series of retaliatory options including a so-called “trade bazooka”.
Officially known as the Anti-Coercion Instrument (ACI), this is a law that allows the EU to respond to economic blackmail from non-EU countries. It threatens very severe consequences.
In July 2025, European Commission President Ursula von der Leyen agreed the EU would pay 15% tariffs on its US exports.
After the agreement, Brussels suspended the tariffs it had planned to introduce on €93bn (£81bn; $109bn) worth of US goods sold to the EU, from livestock and aircraft parts to whiskey.
The European Parliament had been due to ratify the 15% deal shortly, but is now expected to suspend the agreement, sparking fears of a new trade war.
What are Trump’s tariffs on individual countries?
Negotiations continue with a number of countries, including America’s top three trading partners, China, Canada and Mexico, who have been threatened with particularly high tariffs:
What is the UK tariff deal?
ReutersWhich goods are affected by Trump’s tariffs?
Some taxes announced by Trump are on particular products, wherever they are made.
These include:
ReutersIn addition, Trump ended an exemption for imports valued at $800 (£592) or less.
It means low-cost goods are no longer duty-free – a move affecting millions of packages sent every day, including those from online retailers like Shein and Temu.
The companies shipping the parcels now have to pay duties based on the tariff rate which applies to the country the goods were sent from. Otherwise, for six months, they can choose to pay a fixed fee of between $80 and $200 per package.
On 2 January, the White House confirmed it had slashed proposed tariffs of almost 92% on some imported pasta after what it called constructive engagement from firms.
In November, Trump had signed an executive order exempting a range of other food products from tariffs, including avocados, bananas, beef and coffee because of domestic shortages.
Why has the Supreme Court been considering the legality of Trump’s tariffs?
Trump’s tariffs have faced numerous legal challenges.
The Trump administration brough in certain tariffs using the 1977 International Emergency Economic Powers Act. Declaring an emergency under the law meant Trump could bypass Congress.
In August 2025, a US appeals court ruled that most of the tariffs were illegal, but left them in place.
The White House asked the US Supreme Court to overturn that decision. A ruling is expected soon.
Trump posted on social media that it would be a “complete mess” if the Supreme Court struck down his tariffs, and warned of difficulties if businesses were told they could claim refunds.
“It would take many years to figure out what number we are talking about and even, who, when, and where, to pay,” he said.
Have prices gone up for US consumers?
Some products have become more expensive – including toys, appliances and furniture as well as certain foodstuffs.
US inflation was 2.7% in the 12 months to December, down from 3% in September, but up from 2.4% in April, before most tariffs started.
Many firms say they are passing on the cost of tariffs to US customers, including Target, Walmart and Adidas.
The cost of goods manufactured in the US using imported components is also expected to rise.
For example, car parts typically cross the US, Mexican and Canadian borders multiple times before a vehicle is completely assembled.
How are tariffs affecting the US and global economies?
Trump was accused of throwing the global economy into turmoil when he announced the first tariffs of his second presidential term.
Although financial markets have since largely recovered, in October 2025 the International Monetary Fund (IMF) said the overall picture remained volatile, and that US tariffs were having a negative effect.
It forecast global growth of 3.2% for 2025, and 3.1% in 2026. That was a slight increase from its July predictions, but still below the 3.3% it had projected for both years before Trump’s measures were announced.
It thinks the US economy will grow by 2% in 2025, and 2.1% in 2026. That’s down from the 2.8% growth recorded in 2024, but still the fastest among the world’s most advanced economies.
The most recent US figures show the economy picked up speed over the three months to September 2025, as consumer spending jumped and exports increased.
The economy grew at an annual rate of 4.3%, up from 3.8% in the previous quarter. That was better than expected, and marked the strongest growth in two years.
Imports – which count against growth – continued to decline during the period.
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