A Netflix-Warner Bros. merger would danger a monopsony the place a single purchaser wields huge management over {the marketplace}, the previous head of Amazon Studios warned.
Roy Worth, who’s now chief govt of the studio Worldwide Artwork Machine, wrote in a New York Occasions op-ed on Saturday that predictions of doom are nothing new within the movie trade, pointing to the arrival of TV, dwelling video, streaming, and AI.
“But if Netflix acquires Warner Bros., this long-prophesied death may finally arrive, not in the sense that filmmaking will cease but in the sense that Hollywood will become a system that circles a single sun, materially changing its cultural output,” he added. “All orbits—every deal, every creative decision, every creative career—will increasingly revolve around the gravitational mass and imprimatur of one entity.”
To make sure, Netflix has stated Warner Bros. operations will proceed, and the studio’s movies will nonetheless be launched in theaters. In the meantime, Warner’s TV channels can be spun off by way of a separate firm, although HBO can be included in Netflix.
However Worth stated the hazard “is not annihilation but centralization,” with the mixed firm accounting for a fair larger slice of total content material spending.
A discount in bidders additionally means much less content material can be produced, whereas a separate improvement tradition, set of tastes, and danger tolerances can be sidelined, he predicted.
“A Netflix merger with Warner Bros. would create a monopsony problem: too few buyers with too much bargaining power,” Worth defined. “Writers, directors, actors, showrunners, puppeteers, visual effects artists—all are suppliers. The fewer buyers competing to hire them, the lower their compensation and the narrower their opportunities.”
Such reasoning sank Penguin Random Home’s try to merge with Simon & Schuster that may’ve created a e book writer with an excessive amount of leverage over authors, he identified.
In fact, the remaining gamers in Hollywood and content material creation are giants in their very own proper as nicely. A KPMG survey of spending in 2024 put NBC Common father or mother Comcast on the high with $37 billion, adopted by Alphabet’s YouTube ($32 billion), Disney ($28 billion), Amazon ($20 billion), Netflix ($17 billion) and Paramount ($15 billion). Comcast and Paramount additionally made bids for Warner Bros.
Theater house owners, producers and different artistic employees have additionally voiced opposition to the deal, although famed director Bong Joon Ho doubted that the “cinematic experience will disappear so easily.”
Along with the enterprise impression of a Warner Bros. takeover, different opponents raised even weightier issues.
Oscar winner Jane Fonda sounded the alarm on a “constitutional crisis” and demanded that the Justice Division not use its regulatory energy to “extract political concessions that influence content decisions or chill free speech.”
For its half, the Trump administration views the take care of “heavy skepticism,” sources instructed CNBC. The merger is predicted to face distinctive antitrust scrutiny, and Netflix’s $5.8 billion breakup price is among the many largest ever.
On Wall Avenue, analysts see a tech angle within the merger, specifically the significance of content material to coach and energy the following technology of AI fashions that may form the leisure trade’s future.
The acquisition of Warner Bros. would assist Netflix stand out in an AI future, Divyaunsh Divatia, analysis analyst at Janus Henderson Traders, stated in a be aware on Friday.
“They’re also levering up on premium entertainment at a time when competition on engagement from short form video is expected to intensify especially if AI models democratize video creation at an increasing rate,” he wrote.
