Warner Bros. caught between Netflix and Paramount, leaving HBO and CNN futures uncertain

Warner Bros. Discovery executives highlighted the potential of upcoming projects from Warner Bros. and HBO Max during an earnings call Thursday, while pointedly avoiding any mention of an ongoing bidding war between Netflix and Paramount Skydance.

The company’s board of directors is currently reviewing the latest acquisition offer from Paramount, leaving the status of a potential deal unaddressed during the call. Netflix has already proposed an $83 billion deal to acquire Warner Bros. and HBO, though that offer excludes linear networks such as CNN, TNT, and Discovery.

In contrast to the Netflix bid, Paramount Skydance is seeking to acquire the entirety of the company.

Under the proposed restructuring, the linear television networks would be spun off into a new subsidiary named Discovery Global. This entity would shoulder a significant portion of Warner Bros. Discovery’s $33 billion long-term debt.

Chief Financial Officer Gunnar Wiedenfels told investors that the new subsidiary would maintain a sustainable debt-to-earnings ratio.

Market analysts are now focusing on the valuation of the Discovery Global spinoff to evaluate Paramount's offer and to determine if Netflix will increase its current bid.

The battle for control over Warner Bros. Discovery (WBD) has emerged as a definitive proxy war for the future of entertainment, pitting the disruptive logic of streaming against the structural decline of legacy television. Netflix’s reported strategy represents a surgical strike; the streamer is eyeing only the crown jewels—Warner Bros. Studios and the prestige HBO library—to fortify its content moat while aggressively offloading the "linear" burden of debt-heavy cable networks.

In contrast, the Paramount-Skydance proposal adheres to a traditional consolidation playbook. By seeking a full-asset merger, they aim to build a diversified media powerhouse with the requisite scale to compete across all verticals. It is, essentially, a high-stakes bet on horizontal integration as a defense against market fragmentation.

The "Discovery Global" subsidiary sits at the center of this corporate struggle. Its valuation and debt-service capacity will serve as the primary catalyst for the deal’s structure. Should Discovery Global be framed as a viable standalone entity, it clears the path for a precision acquisition by Netflix. Conversely, if the unit is viewed as a distressed liability, Paramount’s "all-in" offer becomes a more pragmatic exit for WBD’s leadership.

Against this backdrop, CEO David Zaslav’s public rhetoric regarding a "creative renaissance" functions as calculated posturing. By projecting optimism across the entire portfolio, Zaslav is attempting to maximize the valuation of the legacy assets that bidders like Netflix would prefer to discard. The fate of iconic brands such as HBO, CNN, and Warner Bros. now hinges on a resolution that will inevitably redraw the map of the global media landscape.

While this deal won’t have a direct economic impact on the Vietnamese-American community, it will certainly change how we spend our downtime. Many of our families are regular viewers of WBD’s core brands, from Warner Bros. films and CNN news to HBO hits like Game of Thrones. The final results of this merger will determine which streaming services our favorite shows end up on—and exactly how much we’ll be paying for those subscriptions in the future.