Will Netflix and DOJ announce consent decree negotiations for the WBD deal by June 30, 2026?

The DOJ second request was issued January 16, 2026, and the resolution date is June 30, 2026 -- giving only ~5.5 months. Second request processes typically take 6-12 months. While the analysis notes consent decree negotiations are plausible (Disney-Fox precedent), multiple factors argue against this timeline: the DOJ's aggressive enforcement posture (AAG Slater's statements), the separate exclusionary conduct investigation adding complexity, bipartisan Congressional opposition, and the 'most of the year' timeline cited in public reporting. Consent decree negotiations require the DOJ to first complete its investigation -- 5.5 months is at the aggressive extreme of what is feasible.

The base rate for consent decree negotiations within 5.5 months of a second request is low. The Disney-Fox deal took approximately 13 months from announcement to DOJ consent decree (Dec 2017 to June 2018 first agreement, July 2018 final). Even adjusting for the fact that Netflix-WBD may be simpler in some respects, the DOJ has opened a separate exclusionary conduct investigation that complicates and likely delays the merger review. The bipartisan opposition at the Senate hearing and Paramount's 'unlawful' characterization suggest political headwinds that discourage early settlement. The Comcast-TWC abandonment precedent shows the DOJ is willing to fight rather than negotiate.

The Stress Scanner's base case assigns ~50% probability to the deal closing with adequate integration, implying some form of conditional approval is the modal outcome. However, the question is specifically about timing -- consent decree negotiations by June 30, 2026. Even if consent decree is the likely eventual path, reaching that stage within 5.5 months of the second request is aggressive. The analysis notes the DOJ investigation could last 'most of the year,' and if we take that literally (9-10 months from January), formal negotiations would begin around October-November 2026 -- well past the resolution date. There is a scenario where Netflix proactively offers remedies to accelerate the timeline, but the current enforcement environment suggests regulators will take their time.

The timeline is the critical constraint. DOJ second request issued January 16, 2026; resolution date June 30, 2026. That is 5.5 months for the DOJ to: (1) complete the second request review, (2) reach an internal decision on enforcement posture, and (3) enter formal consent decree negotiations. Historically, even cooperative mergers take 6+ months from second request to consent decree. The DOJ's concurrent exclusionary conduct investigation and aggressive enforcement rhetoric suggest a deliberate, not expedited, process. The resolution criteria are broad enough that credible reporting of 'formal settlement discussions' could satisfy it, which is somewhat more likely than a filed consent decree.

The evidence heavily favors NO for this timeline. The DOJ second request was issued only 3 weeks before the analysis date, and public reporting suggests the investigation will last 'most of the year.' The DOJ has opened a separate exclusionary conduct probe, which adds investigative scope and reduces the likelihood of a quick negotiated outcome on the merger alone. AAG Slater and FTC Chair Ferguson have signaled aggressive enforcement postures. Bipartisan Congressional opposition further reduces political incentive for the DOJ to settle quickly. The Comcast-TWC abandonment precedent is arguably more relevant than Disney-Fox given the horizontal overlap concerns.

Balancing the base rate against specific factors. The base rate for consent decree negotiations within 5.5 months of a second request for a major horizontal media merger is probably 15-20%. However, several factors push modestly higher: (1) Netflix may proactively propose remedies to accelerate the process, (2) the resolution criteria include credible reporting of 'formal settlement discussions,' which is a lower bar than a filed consent decree, (3) political incentives exist for the administration to show progress on a high-profile deal review. Against this: the DOJ exclusionary conduct probe, bipartisan opposition, and aggressive enforcement rhetoric. Net assessment is modestly above the base rate.

The DOJ second request was issued January 16, 2026, and typically takes 6-12 months. Consent decree negotiations by June 30 requires completion in ~5.5 months, which is at the very bottom of the typical range. The DOJ's aggressive enforcement posture and separate exclusionary conduct investigation make an accelerated timeline unlikely. The Comcast-TWC precedent shows the DOJ will fight rather than negotiate when it has concerns.

The resolution criteria are broader than just a filed consent decree -- credible reporting of formal settlement discussions would suffice. This modestly increases the probability. However, the DOJ investigation is in early stages (3 weeks into second request), and public reporting says it could last 'most of the year.' The bipartisan Congressional opposition and competitor hostility (Paramount calling deal 'unlawful') create political cover for the DOJ to take its time.

The 5.5-month window is the binding constraint. Even optimistic scenarios require Netflix to proactively offer remedies and the DOJ to respond quickly. The Stress Scanner's 50% base case for deal closing suggests eventual conditional approval is plausible, but the timeline question makes this significantly less likely by the June 30 deadline. The Disney-Fox precedent is constructive on outcome but not on timeline compression to this degree.