Antitrust lawsuits are ideally not influenced by politics, but recent events suggest otherwise. We’ve seen this with Trump’s efforts to block AT&T’s acquisition of Time Warner and now with California Attorney General Rob Bonta trying to halt Paramount’s purchase of Warner Bros. Discovery, which is essentially a successor to Time Warner.
This trend feels really odd and, honestly, it doesn’t benefit anyone involved.
And that includes the politicians who often end up looking pretty silly when they lose these battles.
It’s not great for the public either, who are supposed to be the intended beneficiaries of these legal challenges.
The situation with Warner and the surrounding controversy is quite telling.
Basically, the company has struggled significantly with its profit margins.
In fact, it’s always been a challenge.
That’s why AT&T, after successfully overcoming Trump’s attempts to derail their deal with the studio that also owns HBO and CNN, decided to offload everything, leading to the formation of Warner Bros. Discovery.
David Zaslav, the CEO of WBD, despite having a decent track record in cutting costs and achieving success in films, had to sell it to Paramount Skydance, a new conglomerate steered by independent producer David Ellison and his father, Larry Ellison, a tech mogul and Trump associate.
It’s interesting to note that Trump’s argument focused on the potential monopoly of AT&T paired with Warner Media, which includes HBO, CNN, and various streaming services, claiming it would hurt consumers. Yet, in truth, it barely competed against streaming giants like Netflix and Big Tech. Really, it seemed he was more concerned about CNN, as the courts eventually dismissed his antitrust arguments and approved the merger.
Now, Bonta—a relatively unknown figure until now—tried to claim he uncovered a monopoly, which seems like a rehash of Trump’s earlier claims.
AT&T couldn’t make a viable business model out of Warner Media, and the current version of Warner Bros. Discovery isn’t faring any better.
Contention Points
Bonta relished the spotlight for several months, proclaiming that these two mediocre companies were poised to dominate the media landscape through monopolistic practices.
Meanwhile, regulators in the EU and the UK approved the merger just as swiftly as the Trump administration did, even with their reservations about the latter.
Of course, Bonta’s underlying motivation seemed to be garnering support from the far-left factions of his party, especially by criticizing the association between Larry Ellison and Trump, showing he was not going to let their media empire take over.
But as both Trump and Bonta have realized, political maneuvering has its limits.
As my dad often says, Bonta’s major error was getting lost in his own rhetoric.
For weeks, he boasted on social media about how left-wing activist actor Mark Ruffalo inspired this lawsuit, perhaps trying to win over the progressive crowd.
It’s worth noting that Ruffalo seems to spend more time discussing antitrust issues instead of focusing on his film career these days.
Like Bonta, he has a tendency to be rather vocal.
This may have been key in Bonta agreeing to settlement terms that were surprisingly favorable to Ellison, making one question the legitimacy of the initial lawsuit.
Ruffalo made some outlandish claims about the ability of these companies to disrupt the media landscape, even suggesting that Larry Ellison, due to his tech business Oracle’s ties to Israel, was involved in “genocide” in Gaza. That definitely crossed a line.
It’s telling that California’s Democratic leadership began pushing for Bonta to settle as soon as David Ellison hinted at relocating 50,000 jobs out of the state.
Additionally, after Ruffalo’s inflammatory remarks, Hollywood’s notable pro-Israel community conveyed their discontent to key political figures like Governor Gavin Newsom and likely successor Xavier Becerra.
When it comes to money, especially in this scenario, things get real serious, and the Hollywood establishment hinted at withholding financial support.
For the political leaders, the situation became clear.
Did they really want an attorney general with questionable views on antitrust and international matters disrupting the media landscape?
As one insider noted, “You wouldn’t believe how damaging that Ruffalo statement was to Bonta’s case.”
In the end, Bonta got some brief notoriety but not much else.
He secured a settlement that lacked the structural reforms he initially sought, a result that showcased his legal shortcomings and political vulnerability, which may not bode well for any future gubernatorial aspirations.
Perhaps it’s a win for logical reasoning in a way.
Let’s hope this moment serves as a crucial reminder for antitrust enforcers, especially as our monthly streaming bills continue to climb.
