WSJ What’s News - “Netflix Wins Warner Bros. Discovery Bidding War”

Date: December 5, 2025
Host: Daniel Bach
Guests: Joe Flint (WSJ Entertainment Reporter), Georgia Wells (WSJ Tech Reporter), Matt Grossman (WSJ Economics Reporter), Jack Pitcher (WSJ Markets Reporter)

Overview

This episode centers on Netflix’s surprise victory in the bidding war for Warner Bros. Discovery’s Hollywood studios and HBO Max streaming business—a deal with the potential to reshape the entertainment industry. Other topics include Meta’s shift away from the metaverse, upcoming US economic indicators ahead of a likely Fed rate cut, the Supreme Court’s impact on Texas congressional maps, and the dramatic fall of Trump-tied assets in the financial markets.

Key Discussion Points and Insights

1. Netflix’s Blockbuster Bid for Warner Bros. Discovery

[00:55 – 05:31]

• Deal Details:

  • Netflix has entered exclusive negotiations to acquire Warner Bros. studios and HBO Max, outmaneuvering both Comcast and Paramount.
  • Netflix’s dramatic all-cash offer is believed to be around $28/share, focused on studio and streaming assets rather than acquiring the entire company.
  • Paramount, previously considered a frontrunner, bid for the whole company, expecting that to sway the board.

• Why Netflix Won:

  • Joe Flint: “It’s certainly quite a surprise... in the last several days it’s become apparent that [Netflix was] very serious, and they made a dramatic cash offer.” (01:22)
  • Warner’s board saw greater standalone value in the Hollywood assets rather than a bundled sale.
  • Paramount accused Warner of unfairly favoring Netflix and sent several pointed letters, including ones focused on regulatory advantages and fairness.

• Industry Impact and Concerns:

  • The deal is “very significant” for US entertainment, likely to intensify concerns about industry consolidation.
  • Joe Flint: “Even after they’re nearly 30 years old, [Netflix is] still viewed in many ways as an outsider and not always embraced. And the fact that they don’t love the theatrical movie business, that’s going to be an issue.” (04:06)
  • Skepticism persists in Hollywood’s creative community regarding layoffs and Netflix’s commitment to theatrical distribution.
  • Regulatory hurdles are expected, so the deal could take up to two years to finalize.
  • Wall Street’s reaction has been cautious, with Netflix’s stock not showing strong gains post-news.

2. Meta Shifts From Metaverse to AI

[05:36 – 06:34]

• Strategic Shift:
  • Meta shares surged on news that the company plans to cut spending on the metaverse and redirect resources into AI and wearables.
  • Georgia Wells: “Users just aren’t as interested in this Metaverse as the company hoped they would be… Meta believes Mark [Zuckerberg] bet on the wrong horse with the Metaverse, and they’re working to reallocate this spending to AI, where they’re seeing traction with their AI glasses.” (05:59)
  • Despite this pivot, no name change for Meta is expected at this time.

3. Economic Data and Fed Rate Cut Outlook

[06:34 – 08:16]

• Upcoming Indicators:
  • The Federal Reserve will soon review inflation data via the Personal Consumption Expenditures (PCE) Price Index, expected to hold steady at 2.9% year-over-year for September.
  • Matt Grossman: “…that’s higher than the Fed wants to see it at. But in the meantime, at least it’s not getting worse.” (06:56)
  • High likelihood of a third consecutive rate cut in the next Fed meeting.
  • The University of Michigan’s Consumer Sentiment Survey is set to be released, and while slight improvement is anticipated, overall consumer sentiment remains very low:
    • “It’s been very low recently… economists are expecting things to improve a little bit… but it still seems to be a pretty bleak time for consumers.” (07:40)

4. Supreme Court Ruling on Texas Congressional Map

[09:01 – 10:28]

• Political Impact:
  • The Supreme Court, in a 6-3 decision, allowed Texas to use a new congressional map that could provide Republicans up to five additional House seats.
    • The ruling overturned a lower court’s finding that the map was a likely unconstitutional racial gerrymander.
  • This development boosts GOP prospects for retaining House control in the 2026 midterms.
• Related Headlines:
  • Navy Admiral’s defense of a controversial anti-drug operation draws congressional scrutiny.
  • Grand jury refuses to indict New York AG Letitia James, hampering Justice Department efforts.

5. Trump-Linked Assets Plummet

[10:28 – 11:43]

• Market Downturn:
  • Nearly a year into Trump’s second presidency, assets tied to him and his family have sharply declined.
  • Shares of Trump Media & Technology Group, operator of Truth Social (ticker: DJT), are down ~70% since inauguration.
  • Jack Pitcher: “Some people have kind of called it a meme stock… at a very high multibillion dollar valuation compared to its really small revenues. Some people made a lot of money… but recent months, it is really in the tank.” (11:03)
  • Speculative assets—meme coins named after Trump and a crypto venture called World Liberty Financial—have also suffered steep losses as investor appetite wanes.

Notable Quotes & Memorable Moments

• Joe Flint on Netflix’s status:
  “Even after they’re nearly 30 years old, [Netflix is] still viewed in many ways as an outsider and not always embraced. And the fact that they don’t love the theatrical movie business, that’s going to be an issue.” (04:06)

• Joe Flint on industry reaction:
  “There’s going to be a lot of distrust among the writers, producers, directors, and that community. And… this would have happened no matter who bought it… we're going to see two more companies merge, and that's going to be layoffs.” (04:18)

• Georgia Wells on Meta’s strategic re-think:
  “Basically, Meta believes Mark bet on the wrong horse with the Metaverse, and they’re working to reallocate this spending to AI where they’re seeing traction with their AI glasses.” (05:59)

• Matt Grossman on inflation:
  “…at least it’s not getting worse. And that’s one data point that a lot of investors have looked at… penciling in a high probability that the Fed’s going to cut rates again for the third straight meeting.” (06:56)

• Jack Pitcher on speculation and Trump Media:
  “Some people have kind of called it a meme stock based on how it trades at a very high multibillion dollar valuation compared to its really small revenues... But recent weeks, recent months, it is really in the tank.” (11:03)

Timestamps for Key Segments

• Netflix-Warner Bros. Discovery Deal: 00:55 – 05:31
• Meta’s Strategic Shift: 05:36 – 06:34
• Economic Indicators & Fed Outlook: 06:34 – 08:16
• Supreme Court & Texas Map: 09:01 – 10:28
• Trump-linked Asset Declines: 10:28 – 11:43

This episode offers a sweep through pivotal business, technology, political, and market stories, with special focus on how Netflix’s high-stakes acquisition could upend Hollywood and streaming, setting the stage for more industry shifts to come.