The world watches Warner Bros

Just days after Netflix announced its $83B offer for Hollywood’s legendary Warner Bros studio, rival Paramount has now entered the fray with its own hostile $108B bid. 

And we haven’t seen a better love triangle since Edward and Jacob battled it out for Bella’s heart in the Twilight saga. 

But the world is now watching the free world’s most powerful entertainment giants vie for supremacy, and not just because of the billions at stake or the historic egos at play.

So let’s take a quick look at five reasons why this merger is global:

1. Global screens

Netflix is now available in over 190 countries, which is a fancy way of saying it’s now virtually everywhere except China, Russia, North Korea, and (for now) Syria.

The other players in this deal are smaller, but Warner’s HBO Max is still in a cool 100 or so countries, while Paramount Plus reaches a respectable ~40.

So while capitals still impose limits (Vietnam bans Full Metal Jacket, for example), that’s still raw US soft power getting beamed into billions of foreign households every night.

We’re also talking about…

2. Global wallets

The cap tables of these screen giants mean we’re talking about raw US dollars getting pumped into foreign wallets: the single largest foreign investor in Netflix is Norway, while Paramount’s third-largest investor is a fund run by Italy’s powerful Agnelli family.

And of course, that sweet sweet cash now flows both ways: an estimated two thirds or more of all paying Netflix subscribers are now outside the US.

So when you’re reaching global screens and wallets, you’ll draw the attention of…  

3. Global regulatooooors 

The bigger your footprint, the longer the list of regulators who’ll want a say in any merger, even if it’s between US companies.

Take the EU, which has an unlimited stash of red tape rolls it can dust off if a proposed deal risks eroding competition and screwing Europe’s consumers.

Word is Europe seems unlikely to flat-out veto here, given a) this deal could be more vertical than horizontal, b) the EU picks its US battles carefully, but also c) precedent suggests Europe’s regulators might instead attach conditions to protect (say) local cinemas, streamers, and/or creatives.

Then there’s the…

4. Global absences

According to Paramount documents, China-based tech giant Tencent (of WeChat fame) had originally committed $1B towards the takeover bid, alongside pledges from the Saudi, Emirati, and Qatari sovereign wealth funds.  

And just a decade ago that kind of easy cash would’ve made Hollywood execs quiver with delight between Arnold Palmers up at Yamashiro. But times have changed.

Some of the execs were smart enough to realise that this kind of structure (particularly the China angle) would trigger 😨 gasp… “CFIUS review”. 

That’s the secretive Committee on Foreign Investment in the United States, which has broad powers to block foreign investment on national security grounds. These days, your best CFIUS strategy is to avoid CFIUS altogether, which is why a revised deal then ditched Tencent and muzzled the others (ie, leaving the Saudis et al with no operational say). 

But maybe even a CFIUS review could’ve been a little more predictable compared to…

5. Global personalities

Notwithstanding the world’s vast teams of lawyers, economists, and bureaucrats exploring complex philosophical questions to determine the optimal outcome in each antitrust case, big competition decisions are always inherently political.

Yet the notable thing in this case is how much the decider-in-chief (President Trump) is saying the quiet bit out loud, confirming he’ll indeed be personally involved.

So beyond the technical risk this merger could breach the classic 30% US market share threshold, capitals will also be watching for further clues into how Trump wields US power, with early hints Paramount now hopes to pull an Nvidia^* (ie, go direct to the president).

Anyway, let’s close where we opened, shall we? If this is all like a Twilight love triangle, then maybe we already know where Donald Trump stands: firmly on Team Edward.