Netflix inks blockbuster USD72b deal to buy Warner Bros

Good morning. Here's what happened overnight and what you need to know this weekend.

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1.

Blockbuster deal: Netflix agreed to buy Warner Bros Discovery in a deal that will see one of Hollywood’s oldest studios swallowed by a streaming giant. Under the deal, Warner Bros shareholders will receive USD27.75 ($41.82) per share in cash and stock in Netflix. The total equity value of the deal is USD72 billion, while the enterprise value of the deal is about USD82.7 billion. To fund the purchase, Netflix will take on over USD60 billion in debt. Netflix plans to use USD10.3 billion in cash on hand and borrow USD50 billion to fund the cash portion of the takeover, and will also shell out roughly USD11.7 billion in stock to Warner investors and absorb Warner's USD10.7 billion in studio and streaming debt in the deal. Warner Bros will complete its planned spinoff of its cable television networks including CNN, Discovery and Turner before Netflix completes the acquisition. Netflix beat out rivals Comcast and Paramount Skydance, which had been pursuing the takeover since October. The deal is expected to garner intense regulatory scrutiny in the US and the Writers Guild of America has already voiced its concerns. (Netflix)(WSJ)(Bloomberg)(Capital Brief)

2.

Stratospheric valuation: SpaceX is kicking off a secondary share sale that would value the company at USD800 billion, the Wall Street Journal reported on Friday, pushing past OpenAI to make it the most valuable private US company. The rocket maker’s CFO Bret Johnson told investors about the share sale in recent days, sources told the masthead. The valuation would double the USD400 billion value SpaceX notched in its July share sale. The company approached investors as part of a so-called tender offer, which usually takes place twice a year. While there is no guarantee that SpaceX will reach the goal of an USD800 billion valuation, it boasts a dedicated investor base and CEO Elon Musk said on X in June that the Texas-based company was expected to generate about USD15.5 billion in revenue for the year. SpaceX frequently launches its own satellites to low-earth orbit and has around 9,000 satellites in space for its Starlink internet division. (WSJ)

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Energy uncertainty: NextDC chief executive Craig Scroggie admitted that key uncertainties remain over the data centre operator’s $7 billion “hyperscale AI" venture with OpenAI, including critical decisions over energy supply and computing power. On the sidelines of an event to announce the project in Sydney on Friday, Scroggie told Capital Brief the company had not yet gone to market for renewable power, while OpenAI has not yet determined how much computing power it will buy from NextDC, nor has it made any investment commitments. “We have existing [purchasing power agreements], but we will go to market for new renewable energy agreements, solar, wind, battery as part of the new development,” Scroggie said. Scroggie said NextDC expects to tap into the pipeline of undeveloped renewable energy projects that have not reached a final investment decision because they have not been able to secure a long-term customer for its power. The Albanese government released long-awaited details this week of its National AI plan which set “clear expectations for sustainability” on new data centre builds. (Capital Brief)

4.

X rated breach: Elon Musk’s X was fined EUR120 million ($210.56 million) by European regulators for breaching transparency obligations under the bloc’s Digital Services Act (DSA). The penalty, which is the first to be handed down under the landmark DSA rules, is part of Europe’s crackdown on Big Tech, follows a two-year-long investigation by the Commission. The bloc found that X’s use of the ‘blue checkmark' for ‘verified accounts' deceives users as anyone can pay to obtain the status, making it difficult for users to judge the authenticity of accounts and content they engage with. The Commission also found that X's advertisement repository fails to meet the transparency and accessibility requirements of the DSA and that X fails to provide researchers with access to the platform's public data. Earlier on Friday, President Donald Trump’s envoy to the EU, Andrew Puzder, told Bloomberg that the bloc was unfairly targeting US tech giants with its tech rules. (European Commission)(Bloomberg)(Capital Brief)

5.

Decision ahead: US markets inched higher on Friday, notching a fourth consecutive positive day but stopping short of records as traders held steady ahead of the US Federal Reserve’s interest rate decision next week. The S&P 500 closed 0.19% higher at 6,870.40, putting the index around 0.7% off its intraday record. The Nasdaq rose 0.31% to settle at 23,578.13, while the Dow Jones closed up 0.22%. Shares in Warner Bros Discovery closed up over 6% while Netflix shares slid almost 3% on news of their tie-up. Failed bidder Paramount Skydance fell over 10% after losing out. Meanwhile, markets sifted through the final set of economic data expected ahead of the Fed decision, with a key inflation measure coming in lower than expected in September. While the University of Michigan’s consumer survey indicated consumer sentiment improved slightly in early December, lingering concerns over high prices persist, adding to expectations that the central bank will cut its benchmark rate by a quarter of a percent when it meets on Wednesday. (CNBC)(WSJ)(Bloomberg)(Reuters)

6.

Artificially intelligent: Meta will integrate content from major news organisations into its AI assistant to provide Instagram, Facebook and WhatsApp users with real-time content. The company said Meta AI will now offer a broader range of real-time content, including global news, entertainment, lifestyle stories, so that when users ask Meta AI news-related questions, they will receive information and links that draw on “diverse” and “tailored” content sources. As a first step, Meta said it is partnering with CNN, Fox News, Fox Sports and Le Monde Group among others and will continue adding partnerships in the future. Despite a number of AI companies moving to incorporate live web content and news feed in their offering, not all outlets are receptive to the collaborations. On Friday, the NYT and Chicago Tribune sued Perplexity AI, arguing the AI startup is copying and distributing their exclusive content. Meanwhile, AI wearable startup, Limitless, announced that it has been acquired by Meta. (Meta)(Capital Brief)

7.

Viva Las Amazon: In a rare, tightly rationed interview at re:Invent in Las Vegas with six global journalists, including Capital Brief, the longtime Amazon CTO, Werner Vogels, swung around constantly in his chair and rolled through ideas faster than the press could wedge in a question. Vogels distributed his 2026 Predictions and dove into the problems technologists are wrestling with inside the AI boom, including benchmarks, standardisation and LLMs themselves. Among the 43 announcements AWS CEO Matt Garman packed into his Tuesday keynote, the standout unveiling was Trainium3, the company’s new custom AI chip — and its first built on a 3-nanometre process. AWS says Trainium3 can cut costs by up to 50% compared with GPU-based systems. Other announcements included an “AI Factories” product for customers needing large-scale on-premises infrastructure, updates to the Nova foundation models and a suite of new AI agents — including an autonomous DevOps agent described as an “always-on, autonomous on-call engineer". (Capital Brief)

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Innovation consolidation: The Victorian Government will merge startup support agency LaunchVic and technology investment fund Breakthrough Victoria following reviews recommending the government consolidate and streamline the entities’ offering. TheAllan Government said on Friday that while Victoria’s innovation ecosystem is “strong and well supported, with government investment playing a critical role”, it also found that there was duplication across government initiatives. The Government said it will now work closely with the two entities to identify the best path forward, with LaunchVic and Breakthrough Victoria continuing to operate “to ensure continuity and momentum.” On Thursday, InnovationAus.com reported that the state government’s decision in response to the Silver Review found “substantial opportunities to reduce and streamline entities and their staff numbers through carefully targeted cessation, merging and streamlining” and recommended abolishing LaunchVic as a standalone entity. (Govt of Victoria)(InnovationAus.com)(Capital Brief)