‘horrifying’: Hollywood Blasts Trump’s Role In Studio Sale

LOS ANGELES — After a year watching Donald Trump muscle his way into Hollywood — getting late-night hosts suspended, bullying news programs into settlements, threatening TV networks — entertainment executives and Democratic politicians say his intervention in the Warner Bros. Discovery sale may have gone too far.

It also may be a reason Paramount Skydance reached a deal to acquire the company for more than $110 billion after Netflix backed out of the bidding war Thursday afternoon. The sale to Paramount, whose CEO David Ellison has cultivated ties with Trump, will reset the Hollywood ecosystem and throws into question the fate of Warner Bros.-owned CNN, which Trump has said should be sold.

Within hours of the agreement, some industry executives and Democratic lawmakers here said they worry that Trump’s pressure campaign — he demanded last weekend that Netflix fire former Democratic national security adviser Susan Rice from its board or “pay the consequences” — could reshape how political power is wielded over the entertainment industry.

“Unequivocally, yes, it will set a bad precedent for Hollywood,” Assemblymember Nick Schultz, a Burbank Democrat, told POLITICO. “I don’t have a bone to pick with Paramount per se — my concern remains the influence of the Trump administration.”

Hollywood had recoiled after Trump’s ultimatum that Rice be fired ratcheted up pressure on Netflix. There was a sense, though, that the industry could do little about it.

Netflix co-CEO Ted Sarandos, who had previously dismissed Trump’s demand, saying the Warner Bros. transaction was not “political,” met with officials at the White House and U.S. Department of Justice on Thursday to seek assurances that his company’s prospective acquisition would get a fair review from regulators, POLITICO reported.

Hours later, though, Sarandos couched Netflix’s decision to end its pursuit of Warner Bros. in purely economic terms, saying in a statement that the prospective transaction “was always a ‘nice to have’ at the right price, not a ‘must have’ at any price.”

“We’ve always been disciplined, and at the price required to match Paramount Skydance’s latest offer, the deal is no longer financially attractive,” he said.

In fact, some in the entertainment industry saw money as a bigger motivator than Trump. Netflix had reached an agreement with Warner Bros. to acquire its studio and streaming assets for $82.7 billion in December. But Paramount made a hostile bid that month and upped its offer multiple times, culminating in an offer this week that Warner Bros.’ board determined Thursday was a superior proposal. The deal, which requires regulatory approval, includes backing from billionaire Oracle founder Larry Ellison, the father of the Paramount CEO and a friend of Trump.

But the president’s threat over Rice was viewed by many here as helping Paramount, with Trump’s involvement taking on a new dimension by targeting not just programming choices, but questions of corporate structure once largely insulated from political influence.

“It's horrifying that any president would put his finger on the scale for one company over another,” said producer Bill Gerber, a former worldwide president of theatrical production at Warner Bros. whose company has a first-look deal at the studio.

Paramount and Warner Bros. did not respond to interview requests.

The sale of Warner Bros., a Hollywood crown jewel known for films such as “Casablanca” and TV series including “Friends,” has for months been a source of tension in Washington and the entertainment industry. Republican attorneys general from 11 states urged U.S. Attorney General Pam Bondi this week to examine Netflix’s proposed acquisition, arguing it could lead to “undue market concentration that stifles competition,” while California Attorney General Rob Bonta, a Democrat, had already begun reviewing the deal.

Bonta on Thursday night said that the proposed Warner Bros. sale is “not a done deal,” and that his office would continue its probe of the transaction.

“These two Hollywood titans have not cleared regulatory scrutiny — the California Department of Justice has an open investigation, and we intend to be vigorous in our review,” he wrote on X.

Meanwhile, lawmakers and industry figures alike worry that Paramount’s acquisition could trigger deep layoffs. Schultz, whose district includes the Warner Bros. lot, said that there is “a lot of angst in our community” over the sale.

“It creates a lot of uncertainty among our residents,” he said. “I want to ensure that … we're going to have jobs staying in our community, that we're going to see vibrant and consistent production on our studio lot.”

Warner Bros. shareholders are scheduled to vote on the sale on March 20. Paramount began seeking regulatory approval late last year — despite the absence of an agreement with Warner Bros. — an aggressive move that telegraphed confidence in ultimately clearing the process.

Rep. Laura Friedman, whose Burbank district also is home to Warner Bros., said in a statement to POLITICO that the “government’s antitrust decisions must be based solely on what is best for hardworking Americans, consumers, and competition.”

“We must investigate every instance where there is evidence that Trump meddled or wielded improper influence over what should be neutral regulatory processes,” she said.

When David Ellison’s Skydance Media struck a deal to buy Paramount last year for about $8 billion, regulatory approval of the transaction became mired in controversy. The Federal Communications Commission signed off after Paramount agreed to pay $16 million to settle a lawsuit brought by Trump against its CBS News division over a “60 Minutes” interview with Kamala Harris.

Afterward, Reps. Frank Pallone Jr. (D-N.J.) and Jamie Raskin (D-Md.) opened an investigation, warning Ellison that the settlement raised “significant concerns” that Trump had demanded — and Paramount had paid — “an illegal bribe” in exchange for FCC approval. Paramount has denied the allegation, and the FCC has defended its decision.

As for Paramount’s control of Warner Bros., the president has made at least one significant preference clear, saying in December that it was “imperative” that CNN be sold as part of a deal. That followed a Wall Street Journal report that said Ellison promised Trump he’d make “sweeping changes” to the network, which has long been targeted by the president.

The Paramount CEO has been a frequent visitor to Washington in recent weeks, meeting with Trump at the White House in early February and attending the State of the Union address as a guest of Sen. Lindsey Graham (R-S.C.) on Tuesday.

Netflix had, conversely, already come in for heavy scrutiny — from Trump’s Republican allies on the Hill. When Sarandos testified before the Senate Judiciary subcommittee overseeing antitrust earlier this month, lawmakers from both parties raised concerns about consolidation and competition. But Republicans also pressed Sarandos on culture-war issues, grilling him about “woke” content on the company’s streaming service.

The White House and the Justice Department did not respond to requests for comment. A representative of Rice, a former Biden administration official who also served in the Clinton and Obama administrations, also did not respond to a request for comment.

The sale of Warner Bros. to Paramount would have profound implications for the entertainment industry.

Paramount, whose namesake streaming service is smaller than several of its competitors, would be infused with a trove of content, said Laura Martin, a longtime entertainment and media industry analyst with Needham & Co., making it “a really viable competitor” to Netflix and Disney+.

But a sale of Warner Bros. to Paramount could result in “many near-term layoffs,” Martin said, as the enlarged studio would need to pare down debt associated with the transaction. “Paramount … is going to stretch financially to buy Warner Bros., so if they succeed, they’re going to have to cut a lot of costs from the combined company.”

Gerber called the sale “unfortunate,” saying it comes as Warner Bros. Discovery CEO David Zaslav and the studio’s leadership team had begun restoring a culture at the company in which “artists felt looked after, cared about, and supported — where there were decades-long relationships, and movies were about quality, not just exploiting the IP that you own.” It’s working: reporting earnings on Thursday, the company touted a run of nine straight films debuting at No. 1.

Gerber, producer of “A Star Is Born” and “Gran Torino,” among other movies, said he’s hopeful that Paramount would preserve that sensibility.

Even before the agreement was announced, Wall Street investors on Thursday boosted shares of the company more than 10 percent.

Brock Hrehor contributed to this report.