Will Paramount Skydance achieve its goal of acquiring Warner Bros. Discovery? Are Netflix, Apple, or Amazon poised to take the opportunity to acquire HBO and Warner Bros.? Will major European media companies also get involved?
As top executives in the global content industry converge in Cannes for the annual Mipcom conference and market, a significant wave of activity is rolling through the U.S., indicating yet another phase of media asset consolidation. Warner Bros. Discovery stands out as a prime candidate for acquisition, but it’s far from the only entity attracting attention.
The landscape of Hollywood’s major brands will undoubtedly be a central theme of conversation during the weeklong event, running from October 13 to 16, which draws buyers, sellers, producers, distributors, marketers, and advertising experts to the famed Croisette. This year, more than ever, there will be heightened discussions surrounding the innovation, energy, and investments originating from regions outside of Los Angeles and New York.
“It’s an exhilarating period as we embrace a global approach — both in production and streaming,” stated David Zaslav, CEO of Warner Bros. Discovery, during last month’s Goldman Sachs Communacopia + Technology Conference.
The emergence of globally accessible streaming platforms, like Netflix, HBO Max, Disney+, and Prime Video, has established a worldwide entertainment marketplace that connects consumers and producers. This emphasis on showcasing international content alongside local-language series and films has significantly enhanced production capabilities in Europe, Asia, Latin America, and Africa, regions that previously lacked such skilled workforces and production ventures.
This worldwide momentum has led to local shifts in trends. The “micro drama” phenomenon in Asia is making waves in other regions, including the U.S. This trend exemplifies how an influx of capital, resources, and talent can spur innovative growth and profitability from the ground up. Micro dramas, typically presented as one- or two-minute episodic content, also provide a low-budget alternative during a time of rising production costs in Hollywood.
“It’s a fresh storytelling medium for us… instantly reaching a regional, if not global, audience,” remarked Angeline Poh, Mediacorp’s chief customer and corporate development officer in Singapore, emphasizing that brand partners are already finding ways to integrate into this short-form scripted format.
A recent partnership that highlights how major U.S. companies are adapting to technology and global media trends is the advertising alliance between Amazon and Netflix. The two streaming giants have collaborated to allow Amazon Ads to market portions of Netflix’s advertising inventory across various markets, including the U.S., U.K., France, Spain, Mexico, Canada, Japan, Brazil, Italy, Germany, and Australia. This may signal the beginning of numerous initiatives aimed at eliminating the longstanding gap between advertising and sponsorship sales in the U.S. and abroad.
Amazon’s investment in cutting-edge advertising technology, coupled with Netflix’s quest for streamlined ad sales solutions beyond the U.S., paves the way for this alliance. It could pressure major European companies like Germany’s RTL and ProSieben and the U.K.’s ITV, as well as France’s Canal Plus and TF1, to pursue similar strategies for improving advertising reach and efficiency. Advanced advertising tech remains one of the most dynamic areas of digital media development, as businesses across sectors strive for improved efficiency in operations. Additionally, the growth of AI tools — along with their advantages, disadvantages, and uncertainties — will likely resonate throughout Mipcom.
As the auction for the legendary Warner Bros. studio and the influential HBO approaches, the future of Warner Bros. Discovery is set to dominate discussions.
David Ellison, Paramount’s newly appointed leader, caught many off guard by revealing that Paramount is planning a bid for WBD. Just a month had passed since Skydance’s acquisition of Paramount when news of this potential bid began circulating. Observers interpret the rapidity of Ellison’s strategy as indicative of Skydance’s $8 billion purchase of Paramount being merely the first component in a larger ambition to challenge the giants of Big Media.
“This deal does affirm Paramount’s intent to re-enter the fray with significant capital investment in the industry to achieve long-term growth. As Ellison noted, ‘You can’t cut to grow,’” remarked Robert Fishman, a senior media analyst at MoffettNathanson.
“What if these announcements were actually part of a grander scheme from the outset? While we expected a bold strategy from the new Skydance team, Ellison seems ready to take decisive action without waiting to fully assess Paramount’s assets, as evidenced by the now-anticipated bid for Warner Bros. Discovery,” Fishman continued.
However, Paramount might not be the sole contender for WBD. Some analysts believe that Netflix could be hard pressed to remain on the sidelines during a potentially once-in-a-lifetime chance to acquire a prestigious studio and the premium service that has defined subscription television since its inception in the 1970s.
HBO Max is still undertaking its international push in markets where Netflix already holds a strong position. The advantages of such a partnership are evident. Yet, as Laurent Yoon, a media analyst from Bernstein & Co., indicates, acquiring HBO Max may not significantly enhance the overall subscriber base of the combined company — a critical issue for co-CEOs Ted Sarandos and Greg Peters as they strategize their next moves.
“There’s limited potential for subscriber growth, as over 90% of HBO Max subscribers also subscribe to Netflix, which already enjoys high market penetration in other developed and emerging markets where HBO Max aims to expand. While churn may improve with a stronger content portfolio, the potential for growth remains limited given Netflix’s established position,” Yoon shared in a research note dated September 29, addressing the growing rumors surrounding Netflix-WBD.
The ongoing speculation regarding WBD’s fate will certainly resonate throughout the Palais des Festivals and various other locales in Cannes, where industry insiders congregate. Meanwhile, they’ll be eagerly anticipating the first indications of the next major trend that will be pivotal in discussions next year.
Naman Ramachandran contributed to this report.
