Grab your popcorn.
Paramount isn't giving up the Warner Brothers deal without a fight.
It's World Business Express from the BBC World Service.
I'm Leanna Byrne.
China is running a massive trade surplus and other countries are not happy about it.
And Elon Musk is escalating his row with the European Commission.
Okay, let's dive into what could be the biggest shake-up in the entertainment industry since the dawn of streaming.
Netflix's acquisition of Warner Brothers Discovery.
Now Paramount Skydance have just launched a hostile 108 billion bid to buy all of Warner Brothers Discovery.
So, what does Netflix need to do to get this deal done?
Well, let's play a game with Guy Bisson, Executive Director at Ampere Analysis.
Some routes lead to the deal, and for others, it's game over.
Game over.
Let's start with the first major fork in the road, regulators.
Is this deal going to clear antitrust security in the US and Europe?
Guy, what do you think?
The simple way is it could get passed, but that's extremely rare for these very large mergers to not hit any brick walls at all.
More likely is that there will be challenges from both regulators and and also possibly from the other bidders who lost out to Netflix in this case.
It doesn't necessarily block the deal if regulators raise issues.
They could say, we need you to do X, Y and Z in order for the deal to pass.
So that would be another scenario where they put conditions on the merger.
And that condition could be for example, you must sell HBO Max operations, the streaming operations, but you can keep the studios and the IP and the content.
So if regulators give the green light, though just hypothetically, I suppose there's another path.
This deal has to survive.
It has to survive the shareholders, doesn't it?
So what's their likely response?
Shareholders, I would think, will probably approve the deal.
Other shareholders, other bidders have already raised concerns with this deal about the process.
Paramount, which has recently itself been acquired by Skydance, which is David Ellison's company, has raised objection to the process of the negotiations that led to this deal being announced.
So it will almost certainly hit legal challenge.
Right.
So hypothetically Guy, if we get through all the regulators, the shareholders, the industry, legal challenges and this deal closes, what's the strategy for consumers?
Do you think people who have Netflix subscriptions, they might be paying less or more?
That very much depends.
At the moment, Netflix is saying that it's going to keep the streaming services separate, possibly bundle them into a package, which then, of course, would cost a bit more, but it would be less than the sum of the two parts.
More likely longer term is that they absorb HBO Max its content and uses it as part of its wider content offer to consumers.
At that point, there would likely be price rises once these assets are combined.
That was Guy Bisson from Ampere Analysis, who's a great sport.
With me now, Jane Sydenham, Investment Director at Rathbones.
Jane, I'm really interested.
What's the financial market reaction to this bid from Paramount Skydance?
Yeah, well, it's all come to life this afternoon.
So Netflix shares are down about 45 because the market's now obviously thinking.
Their opportunity to pick up an amazing long-term strategic asset now looks as if it could be slipping through their fingers.
Warner Brothers shares are up 6% because this bid is an all-cash offer of $30.
So the shares are currently $27.70 and moving up.
And then Paramount Skydance are also up about 6%.
So they should be back into the game with the possibility of this great strategic asset.
So, you know, lots going on in terms of share price movement.
Yeah, a little bit of wait and see, wouldn't it be, Jane?
Yeah.
Oh, for sure.
I mean, there's lots of, there may be further twists and turns to come.
Who knows?
Netflix might come back again with another offer.
That that sometimes happens in these situations, because these assets are unique.
They don't come up for sale very often.
Absolutely.
Jane Sydenham, thank you so much.
Now.
China's exports rose again in November, pushing its annual trade surplus above 1 trillion for the first time.
In simple terms, China is selling far more to the world than it is buying.
And that gap is widening.
Fabian Sulig is chief executive of the European Policy Centre think tank.
It still over the year reflects the challenges, in particular the trade dispute with the US, but there seems to be a recovery there.
For other parts of the world.
This will be worrying data because it also shows that exports from China are going to different places, avoiding the US.
What do you think the European Union would make of this data?
In the European Union, there has been worry that we have not seen the rebalancing in the Chinese economy, which we would have liked increased demand domestically, so that the overcapacity which is there in manufacturing now has to go somewhere else than the US.
And that means a challenge for European industry and a challenge in the trade relationship with China.
Does this say that China doesn't necessarily need the trading with the EU and the US?
I think that would be premature.
The Chinese economy is still very dependent on trade.
What we've seen.
When China doesn't have the US market as it had before, it then needs to rely more on other markets like the EU.
So it's not that they have lost both markets or that they have problems in both markets.
Hmm.
I mean, the export numbers look strong, but at the same time China's domestic economy appears softer.
Weak retail spending, there's also a slump in housing.
Can those exports alone keep China's growth on track?
It certainly has been a big factor in China's growth rates over the years.
But China also continues to need high growth rates.
So certainly from also a Chinese perspective, it would be much healthier to have stronger domestic demand, domestic consumption.
That was Fabian Sulig from the European Policy Centre.
Meanwhile, Elon Musk's ex has blocked the European Commission from making adverts on its platform, a few days after the EU regulator issued the company with a fine over its blue tick badges.
Our tech reporter Chris Vallance has been following developments.
It begins really with their investigation into the way that accounts are verified on X And essentially it became a system where if you got an account, if you paid money, you got a blue tick.
The European Commission isn't very happy with the way blue ticks worked.
They launched an investigation and they fined X for 120 million euros.
That's about 140 million dollars.
X has hit back, if you like, by blocking the European Commission from making adverts on its platform, claiming that they had taken advantage of an exploit in its advertising system.
And the EU Commission responded by saying that they always use social media platforms in good faith.
But the context for this, of course, is a lot of pushback from the US administration, pushback from Mr Musk, over the European regulation of technology firms, particularly American technology firms, which they regard as censorship.
So you think that transatlantic row might get worse because of this?
Well, I mean, I think we've certainly seen some big players join the fight, if you like, around this.
U.S.
Secretary of State Marco Rubio was talking about, said that the European Commission, fine isn't just an attack on X, it's an attack on all American tech platforms and the American people by foreign governments.
J.D.
Vance described the fine as a response for not engaging in censorship.
Of course you know, one of the things that the European Union can say is they're just regulating their own patch.
Chris Vallance there.
And that's it from World Business Express.
I'm Leanna Byrne.
Thanks so much for listening.
