Netflix's Big Power Play

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For consumers, the best media merger is usually none at all. Such deals always seem to lead to higher subscription fees, less diversity of ideas, and myriad other unpleasantness.

That said, Netflix's acquisition of Warner Brothers' movie studio and streaming business for $83 billion is probably about as good as it gets for the rest of us, grading on a very steep curve. The reason why is perhaps best expressed using a metaphor borrowed from a different media giant.

Realistically, at some point in the bidding process that led to Friday's deal announcement, "no merger" ceased to be a viable option a long time ago. Once Warner Brothers was in play as a possible acquisition target, with an army of bankers and lawyers richly incentivized to close a sale, the company was (and is) never really going to remain independent again.

To claim otherwise at this point is akin to believing Bambi lives in the forest.

Some details to watch from here:

• The deal still needs regulatory approval. That's no small caveat as there are significant antitrust issues involved, some of which may be raised in litigation by rival bidders Paramount Skydance and Comcast.
• CNN and Warner Brothers' other existing cable businesses will be spun off into a separate company if the Netflix deal goes through. That ensures the news network's independence -- for now. Which is great. But to be honest, I would still worry about its longer-term prospects, as the post-spinoff CNN would effectively be jettisoned inside a pure-play cable company facing structural decline. Much better to be part of a conglomerate with some growing digital businesses to help subsidize all those foreign bureaus, producers, and make-up artists who work behind the cameras.
• Paramount Skydance's bid was structured much differently. They were (and perhaps still are?) trying to buy all of the existing parent company Warner Brothers Discovery, including CNN and its other cable assets. The Ellison family, which controls Paramount Skydance, has very vocally supported the Trump administration politically. Until recently, that made many Wall Streeters believe Paramount Skydance stood the best chance to win the bidding for Warner Brothers, as they could perhaps gain regulatory approval more easily than other suitors. But it also raised concerns among journalists that the Ellisons might meddle with CNN's editorial work to tilt the network rightward if they were to acquire it.
• Over at the entertainment site /Film, Ben Pearson looked into how the Netflix deal might affect Warner Brothers' DC Comics content in particular. Pearson says some future DC movies might not get theatrical releases at all under a Netflix regime. But he thinks DC's venerable magazine business could remain surprisingly unscathed, as its continuance would help protect movie rights to characters like Batman and Superman.

Which brings us to that other perennial question that must be answered regarding any proposed media merger: Is it good for the Justice League? 🙃🦸🦇

Week in Review: Nov. 30 to Dec. 6, 2025

• The AI battle among Silicon Valley's heavyweights escalated sharply. In a memo to OpenAI staff, CEO Sam Altman declared "code red" about the urgent need to respond to increased competition from Google and Anthropic. In particular, Altman is concerned about users' rapid adoption of Google's Gemini 3 model, which launched in late November... Meanwhile, Meta is expected to cut its metaverse budget by up to 30% next year to shift spending toward AI.
• Strategy, a major holder of bitcoin, said it has created a $1.4 billion cash reserve to fund future dividend payments. The company also slashed its full-year profit projections, underscoring the problems that have plagued digital-asset treasury (DAT) companies lately. As crypto markets have swooned, the valuations of DAT companies, which are based on the token holdings on their books, have plunged as well. (Sherwood News)
• AI and consumer-electronics companies are increasingly battling for access to memory chips amid a global supply shortage. Yikes. (Reuters)
• News publishers' love-hate relationship with AI continues. The Press Gazette's Charlotte Tobitt published an updated summary of which organizations are suing AI startups over past usage of their work as training data. But some are also signing licensing deals with the likes of Meta or OpenAI.
• U.S. prosecutors are pushing for a maximum 12-year prison sentence for Terra founder Do Kwon, whose crimes resulted in $40 billion in investor losses. Such hard-line enforcement has been rare recently as the Trump administration has generally sought to ease crypto regulation. (Decrypt)

Market Snapshot

A quick look at some major indicators as of Friday's close on Wall Street:

Looking Ahead

• Core Scientific, a company that previously filed for bankruptcy after building a massive data center to mine bitcoin in Denton, Texas, is now pivoting to provide cloud computing capacity for AI startups. Their move is emblematic of a choice many crypto miners are weighing right now. (Forbes)
• Stablecoins have been the primary focus for crypto policy worldwide in 2025, according to a new analysis by TRM Labs. The analytics and compliance firm reviewed regulatory developments this year across 30 jurisdictions and found over 70% of them were advancing new rules on stablecoins.
• An Indiana lawmaker has introduced a bill to allow public employees to invest in digital currencies through the state's retirement and savings programs. (Decrypt)

Odds & Ends

• Where have all the sneakerheads gone? A California sneaker store owner’s rant about the collapsing resale market for collectible sneakers recently went viral on social media. Some hobbyists believe the thinning trade is symptomatic of a slowdown underway in the broader U.S. economy. (The Daily Dot)
• The South Florida Water Management District has been deploying dozens of robotic rabbits recently in an effort to control an infestation of Burmese pythons in the Everglades marshland, where they are a non-native species. The solar-powered bunny bots help lure and detect the otherwise well-camouflaged pythons so they can be removed humanely. (Fast Company)

That's it for now. Thanks for reading the newsletter today! If you want to know more about w3w's history and (ahem) the author, that info is available here.

Please note, I regularly use several AI apps to assist production of w3w. But the final edit is 100% by me. For fuller detail, see the newsletter's commit history on GitHub.

If you need to reach me directly, please email peter[at]pmckay[dot]com.

Best wishes for a healthy and productive week ahead.