🎬 "Entirely Expected"

👋 Good morning! McDonald's just released an AI-generated Christmas commercial, joining Coke in the noble tradition of letting algorithms handle the holiday spirit. The production team insists they "hardly slept" for weeks crafting prompts and declares "AI didn't make this film. We did." Say what you will, but typing 'make it funnier!!!' at 3 AM and getting the AI to actually listen probably does require some skill. Backlash got so bad the ad has since been pulled.

Welcome back to The Dailies. We’ve got your mid-week industry briefing. Grab your coffee and let’s get into it!👇

Well, that escalated quickly. Just days after Netflix struck its $82.7B deal for Warner Bros., Paramount launched a hostile takeover bid Monday morning, taking its $108.4B all-cash offer directly to WBD shareholders. Some details on the Paramount deal:

Paramount revealed its partners: Sovereign wealth funds from Saudi Arabia, Abu Dhabi, and Qatar are contributing $24B, along with Jared Kushner's Affinity Partners fund. The deal's fully backed by the Ellison family's Oracle stock (worth $250B+) plus debt commitments from Bank of America, Citi, and Apollo totaling $54B. The Middle East backers agreed to give up board seats and voting power to avoid triggering a government review of foreign investment, though critics point out the optics of foreign sovereign wealth funds backing a bid for American media assets aren't great.

Ted Sarandos and Greg Peters weren't rattled. They called the hostile bid "entirely expected" and painted themselves as job creators versus Paramount's planned $6B in cost cuts. They leaned on Nielsen data for their antitrust defense: even with HBO Max added, Netflix would only hit 9% of U.S. viewing time (behind YouTube's 13%), while a Paramount-WBD merger would control 13.8%.

The theatrical promises: Sarandos doubled down on keeping Warner Bros.' theatrical business intact. "We didn't buy this company to destroy that value," he insisted. Meanwhile, Ellison's promising 30+ films yearly and citing James Cameron and Jane Fonda calling the Netflix deal "a disaster for theatrical."

What happens next? WBD's board has 10 business days to respond, but they're unlikely to cancel the Netflix deal since that would trigger a $2.8B termination fee. Shareholders have until Jan. 8 to accept Paramount's offer. Industry insiders expect Paramount will need to raise its bid by another $5B-$10B to prevail, setting up a fight that could stretch well into 2026.

GEN V is awards eligible in Best Comedy Series and available for guild members at ConsiderAmazon.com and is streaming now on Prime Video.

📀 Letterboxd's Video Store launches today with nine films distributors wouldn't touch. The platform's "Unreleased Gems" shelf includes undistributed festival standouts like 'It Ends' (SXSW 2025) and 'The Mysterious Gaze of the Flamingo' (Un Certain Regard winner at Cannes). The TVOD model is straightforward: no subscription, just $3.99 to $19.99 rentals across 23 countries. Films stay available for 30 days, giving Letterboxd's 24M users a chance to watch what they've been watchlisting. With traditional buyers for mid-tier indies becoming scarce, the data-driven model could open up new distribution paths for festival darlings that would otherwise disappear.

🤖 AI-generated films are officially in the Oscar race. In case you forgot, back in April, the Academy clarified that AI tools "neither help nor harm" nomination chances. Unlike previous contenders like 'The Brutalist' and 'Emilia Pérez,' which quietly used AI for voice tweaks and only acknowledged it sheepishly during campaigning, the first wave of proudly AI-generated films has now arrived. Former DreamWorks animator Craig Lew's 'Ahimsa' qualified in Animated Short Film using platforms like Runway and Google Veo, while other contenders are using custom AI trained models only on their own artwork. With voting now underway, we'll see whether voters embrace or reject these films.

🇺🇸 The White House wants states out of the AI regulation business. President Trump announced he'll sign an executive order this week replacing state AI laws with federal rules. That's bad news for entertainment: 38 states passed around 100 AI laws this year, many including protections Hollywood fought for like deepfake bans and actor likeness rights. This continues Trump's July pattern, when he said requiring AI companies to pay for copyrighted content was "not doable" while unveiling his AI Action Plan. The administration's reasoning is that beating China in AI matters more than creator protections. Legal experts say presidents can't preempt state laws through executive orders, so expect court battles ahead.

The nominations for Hollywood's big pre-Oscars party dropped Monday, and Paul Thomas Anderson's 'One Battle After Another' dominated with nine nods. The film led the pack, followed by 'Sentimental Value' (8) and 'Sinners' (7). Some notable moments:

The biggest snubs? 'Wicked: For Good' missed the best picture category entirely, despite box office success (though Cynthia Erivo and Ariana Grande still got acting noms). Sydney Sweeney got shut out for 'Christy,' and the third 'Knives Out' film didn't make the cut.

The Globes also debuted a new podcast category, with 'Smartless,' 'Call Her Daddy,' and 'Armchair Expert' earning nods. The nominees skewed toward personality-driven shows. Political podcasts (including those from Ben Shapiro, Joe Rogan, and Candace Owens) were among the 25 shows automatically considered based on popularity, but didn't make the final six.

Looking ahead… The ceremony, hosted by Nikki Glaser for the second year, airs January 11 on CBS and Paramount+.