In December, the imbroglio involving the Warner Bros. triangle. Discovery-Netflix-Paramount was far from an outcome. At that time, streaming was considered the favorite to close the deal.
At the time, Front Office Sports analyzed David Ellison’s then-hostile offer of US$108 million (the negotiation dragnet accumulated nine proposals until last week) with the aim of presaging a new strategy for media giants to acquire live sports rights.
The publication raised the following hypothesis: instead of competing for sports rights against several competitors, why not buy a rival and inherit their contracts? It would be a high-risk, high-reward strategy that would need a healthy war chest for acquisitions.
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With few important sports rights up for grabs in the coming years, acquiring assets before they go to open auction ensures a competitive advantage.
FOS recalled how Ellison got into the NFL business. In 2025, Skydance Media completed an $8 billion deal to merge with Paramount Global, owner of CBS Sports.
Days before the FOS report, I showed that the billion-dollar onslaught exposed a point of weakness: TNT Sports as an example that sport has become the last field in which media and capital models face their limitations. Vertical integration returns to the center of the strategy.
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The FOS projection was that Ellison could create a sports media superpower with a treasure trove of live rights controlled by CBS and WBD’s TNT Sports. As a cherry on top, these channels would continue to share the rights to one of the country’s main sporting events: the NCAA men’s basketball tournament, March Madness.
With Netflix’s official exit from the dispute last week, Paramount Skydance paved the way to build a media empire focused on sports. At least that’s what the 365247 Sports blog called the venture back in January, when Ellison’s move had not convinced WBD shareholders.
For Paramount, the blog recalled, sports ceases to be a segment of content or a programming item to become the backbone of its streaming logic, the last defensible obstacle in a brutally competitive subscription market, in which turnover is cheap and loyalty is rare.
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Changes in share control, however, accelerate repositioning. Now, the question is not just who owns the content.
The fate of TNT Sports
After Netflix announced at the end of January that its $83 billion bid for Warner Bros. would be paid entirely in cash, a document showed that streaming would inherit some of the various sports rights globally, including the UFC in part of Europe and the Champions League in Brazil and Mexico.
Last month, François Godard noted that Discovery is Warner’s third-largest linear unit in Europe. If WBD were acquired by Paramount, the fate of the operation would tend to replicate the American model. In the UK, some integration with Channel 5 would be plausible.
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Under a Netflix acquisition, the scenario would be different, after all streaming does not operate linear channels. Discovery would need partners or fragmented sales by country. Godard suggested that Italy, Discovery’s biggest profitable market in the region, could become a natural target for Sky.
There is also the equation of TNT Sports in the United Kingdom. WBD holds 50% of the operation and may acquire the other 50% from BT by September. This decision precedes any reset.
If Paramount were to win, the analyst predicted, the integration of TNT with Paramount+ would make sense, especially considering that the platform acquired the rights to the Champions League from 2027 onwards.
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So now comes the inevitable irony: after losing the Champions League, TNT may find it again under the same controlling group.
The real weight of the sports channel in the evaluation
When writing about the sports rights battle placing TNT Sports in the balance, James Mortimer highlighted that for investors focused on media cash flow, the value of WBD’s Linear Networks division lies almost entirely in its sports rights.
And the future of this portfolio would define the success or failure of the Discovery Global division after the acquisition.
In the insider’s opinion, the most significant event that impacted TNT Sports’ valuation before the sale was the loss of the NBA package in 2024, a historic US$77 billion deal that ended up being closed by Amazon Prime Video and NBC Sports (Comcast).
The loss of the NBA rights, a key asset for the Turner networks for decades, was a severe blow that triggered a rapid and visible change on the part of WBD management. The company acted quickly to mitigate the damage through diversification and strategic partnerships.
WBD signed an 11-year agreement with the NBA for the digital part, managing to maintain a share of basketball content.
Simultaneously, WBD “swallowed up smaller sports properties,” including the rights to Roland-Garros from 2025, and Unrivaled, a new 3×3 women’s basketball league.
Additionally, WBD consolidated its relationships with Disney/ESPN to sublicense key college sports properties, including early-round College Football Playoff games and rights to the Big 12 and Big East conferences (crucial for a predominantly American audience).
As Mortimer highlighted, by replacing a marquee, high-cost property with a broader and potentially cheaper set of rights, WBD maintains the relevance of TNT Sports and stabilizes the cash flow coming from Discovery Global Networks, thereby supporting the valuation required in the auction.
In a projection made at the end of last year, Mortimer drew three scenarios. And in which Paramount won the dispute, a merger with WBD would definitively transform the sports media landscape.
The main advantage of the merger with Paramount is the promise of immediate and large-scale synergy. The combined portfolio can be integrated across linear (CBS, TNT) and streaming (Paramount+, HBO Max) channels, achieving the efficiency and scale needed to effectively compete with giants like Amazon and Netflix.
For WBD shareholders, this scenario guarantees that the Linear Networks division will be absorbed by a stronger and more complementary structure, justifying a higher valuation for the entire company.
The Rights Abyss of 2028
The investment thesis surrounding WBD is based on the aggressive deleveraging led by David Zaslav since the merger.
As Mortimer highlighted, long-term debt reached US$48.6 billion in 2022. It fell to US$41.8 billion in 2023. At the end of 2024, it was estimated at US$36.7 billion. In the second quarter of 2025, it dropped to approximately US$34.4 billion.
Still, the valuation range discussed in the market, between US$70 billion and US$80 billion, presupposes something beyond financial discipline. As the analyst pointed out, these numbers are only justified under two hypotheses: relevant synergies in the short term or buyers with strategic motivations that are not strictly financial, such as soft power projection in the case of the PIF.
For investors, therefore, regulatory and geopolitical risks now have similar or greater weight to operational metrics, warned Mortimer.
In 2024, when analyzing Skydance’s US$8 billion injection into Paramount, I highlighted that Ellison was already positioning sport as the company’s structuring axis, promising a robust and interactive vertical for NFL fans.
Now, the determining factor is not just scale or synergy. And this is where the temporal component comes in.
Mortimer draws attention to an important point: the NHL and Major League Baseball contracts expire in 2028. This deadline creates an objective limit for the valuation thesis of the Linear Networks division.
By accelerating the sale now, WBD’s management monetizes assets that still carry three years of contractual predictability and transfers the risk of 2028 to the new controller (Paramount) before the market fully adjusts this issue in the valuation.
