Why Paramount’s David Ellison Can’t Afford to Lose the Battle for Warner Discovery

Paramount Skydance CEO David Ellison speaks during the Bloomberg Screentime conference in Los Angeles on October 9, 2025. (PATRICK T. FALLON/AFP via Getty Images)

It’s no surprise that Paramount Skydance is pulling out all the stops in its battle for Warner Bros. Discovery. The entertainment company simply can’t afford to lose the fight with Netflix for the takeover.

Paramount made a $30 a share hostile bid for all of Warner Discovery on Monday, arguing that its offer was both a better deal for shareholders and more likely to win regulatory approval.

CNN—a longtime sore spot for President Donald Trump—could play a key role in negotiations. Paramount CEO David Ellison has in recent days promised White House officials that he would make sweeping changes at the cable news channel, The Wall Street Journal reported late Monday, citing people familiar with the matter.

The full-on charm offensive makes sense, because this is a make-or-break moment for Ellison as he seeks to build a streaming platform that can compete with the industry’s Big Two of Netflix and Disney +. Paramount sits at an “existential crossroads” right now because buying Warner Discovery would be crucial to helping the company scale its direct-to-consumer streaming business, MoffettNathanson analyst Robert Fishman wrote Monday in a research note.

Investors feel the same way, judging by recent moves for shares. They rebounded 9% on Monday after Paramount unveiled its hostile bid, having slumped 9.8% on Friday when Netflix announced its deal for Warner.

Paramount stock slipped 3.2% in early trading Tuesday. Warner Discovery climbed 1.7% to $27.70, and Netflix slid 0.2%.

It may all come down to how shareholders feel about the future of cable TV—Paramount’s offer is for all of Warner Discovery, whereas Netflix is only bidding for the entertainment company’s streaming and studios divisions.

Netflix’s offer values Warner at $27.75 a share: $23.25 in cash and the remainder paid in Netflix stock. The simplest way to lay out the choice facing shareholders is this: If they think that the cable channels are worth more than $2.25 per share, then Netflix’s bid is better.

Warner Discovery has 10 business days, or until Dec. 22, to decide if Paramount’s bid is superior to Netflix’s. Until then, Ellison faces a nervous wait.

Write to George Glover at george.glover@dowjones.com