• by Adam Buckman , Featured Columnist, 9 hours ago

Netflix sent a note of triumph to subscribers after the company sealed a deal to buy Warner Bros. Discovery, but now Paramount has sent a letter to WBD shareholders promoting its own deal and trashing Netflix.

The Netflix email arrived in subscribers’ inboxes in the wee hours of Saturday morning (December 6), just hours after Netflix and WBD announced their deal last Friday (December 5) for Netflix to buy Warner Bros., HBO and HBO Max (passing on the Discovery cable networks).

The Netflix email ballyhooed its purchase worth $82.7 billion (pending regulatory approvals both in the U.S. and abroad).

It also was designed to allay possible confusion that subscribers might have about how the purchase would affect them.

“We recently announced that Netflix will acquire Warner Bros., including its film and television studios, HBO Max and HBO,” the Netflix email said.

“This unites our entertainment service with Warner Bros.’ iconic stories, bringing some of the world’s most beloved franchises like ‘Harry Potter,’ ‘Friends,’ ‘The Big Bang Theory,’ ‘Casablanca,’ ‘Game of Thrones’ and the DC Universe together with ‘Stranger Things,’ ‘Wednesday,’ ‘Squid Game,’ ‘Bridgerton’ and ‘KPop Demon Hunters’,” it said.

“Nothing is changing today,” Netflix said. “Both streaming services will continue to operate separately.”

“We have more steps to complete before the deal is closed, including regulatory and shareholder approval. You’ll hear from us when we have more to share,” the company promised.

The email contained an embedded link to a Netflix Help Center with a list of nine questions subscribers may be asking. 

What does this mean for my membership? said one question. Answer: Nothing is changing with your membership today. 

Will there be any changes to my monthly subscription plan? Answer: Nothing is changing with your current plan.

When will Warner Bros. shows become available on Netflix? Answer: Nothing is changing with content currently on Netflix.

Two days after Netflix shared all that good news, Paramount put in a bigger bid worth a total of $108 billion -- not only for the Warner Bros. side of WBD, but for the Discovery cable channels too.

Two days later, Paramount released its plea to WBD shareholders. “IT IS NOT TOO LATE TO REALIZE THE BENEFITS OF PARAMOUNT'S PROPOSAL IF YOU CHOOSE TO ACT NOW AND TENDER YOUR SHARES,” says this sentence in all caps, bold and italics.

“Paramount’s $30.00 [per share] all-cash offer for all of WBD delivers greater value than Netflix,” the letter says.

“Netflix faces severe regulatory uncertainty and closing risk. Paramount does not,” the letter says, although it is hard to envision a Paramount deal sailing through without at least some regulatory obstacles of its own.

“Paramount’s offer not only delivers superior value and certainty, but also a much shorter and more certain path to completion,” the letter asserts.

“WBD’s transaction with Netflix, on the other hand, appears to be in for a long and bumpy ride,” the letter insists. 

The letter even complains of a “murky sale process” on the part of WBD. “Since Monday, we have had the opportunity to speak with a number of WBD shareholders who have expressed confusion and disappointment at the process that WBD conducted, which appears to have prioritized a deal with Netflix over shareholder value maximization,” Paramount said.

On Thursday, reports were circulating that Paramount is preparing a bid even larger than the one it has already made. The bidding war is on.