Chatter Box Film

One of the largest movie and TV streaming platforms, Netflix has officially entered into a definitive agreement to acquire Warner Bros. Discovery, Inc. for $72 billion.

This deal comes after an intense bidding war for WBD, between three main contenders: Netflix, Paramount Skydance, and Comcast.

After David Ellison lost the bid, he has called the bid ‘unfair’ in letter to the board of studio. Ellison’s Skydance Media which already recently merged with Paramount Pictures for $8 billion and gained CBS news, as well as has holdings in TikTok, is now attempting to get the Netflix merger with Warner Bros. Discovery stopped; with an alternative hostile takeover offer directly to WBD shareholders.

The Writers Guild of America West and East have also opposed this merger taking place, writing that it ‘must be blocked’: ‘The world’s largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent. The outcome would eliminate jobs, push down wages, worsen conditions for all entertainment workers, raise prices for consumers, and reduce the volume and diversity of content for all viewers. Industry workers along with the public are already impacted by only a few powerful companies maintaining tight control over what consumers can watch on television, on streaming, and in theaters. This merger must be blocked.’

SAG-AFTRA, the Screen Actors Guild remains cautious and questions the future of the entertainment industry in new statement about the merger: “The potential Netflix/Warner Bros transaction is a consolidation that may serve the financial interests of shareholders of both companies, but which raises many serious questions about its impact on the future of the entertainment industry, and especially the human creative talent whose livelihoods and careers depend on it.”

The transaction of the deal is still expected to finalize in 12-18 months. If the deal does fall through due to anti-trust laws stopping it, there is reportedly a $5.8 billion break-up fee that Netflix would be paying to Warner Bros.

What does this deal mean for the future of Warner Bros. Discovery?

Netflix will currently be keeping WBD operations as is, while acquiring WB TV, film studios, streaming assets and gaining the entire WB film and TV library, as well as WB Games.

In a Netflix press release about the aquisition, Co-CEO of Netflix, Ted Sarandos states: “By combining Warner Bros.’ incredible library of shows and movies—from timeless classics like Casablanca and Citizen Kane to modern favorites like Harry Potter and Friends—with our culture-defining titles like Stranger Things, KPop Demon Hunters and Squid Game, we’ll be able to do that even better. Together, we can give audiences more of what they love and help define the next century of storytelling”.

There’s been no mention about how physical media releases for titles will be impacted., will there be significant price increases, less availability or a forced obsolescence of WBD physical media? Netflix originally started off as a company delivering DVD rentals to homes, however the shift to digital streaming hit off, eventually putting physical media store competitors such as Blockbuster gradually out of business.

What is happening to HBO and HBO Max

Current CEO and President of WBD made it clear that the HBO Max streaming platform will be staying after the merger with Netflix, and Sarandos mentions “HBO and HBO Max also provide a compelling, complimentary offering for consumers. We expect these businesses by joining forces, we are creating a stronger organization than either of us could have achieved alone”.

Is DC Studios finished?

In terms of DC Studios: Bloomberg reports that James Gunn and Peter Safran’s contracts as the Co-Heads of DC Studios have been extended to 2027. There are still many projects to release in the coming years including Man of Tomorrow, Supergirl, Lanterns and Waller series, Clayface, The Batman 2 and more.

What is happening to cinema releases?

As of yet, the cinema experience for WBD projects isn’t being taken away, although at some point in the future there is going to be an impact to the release windows for how long a movie will stay exclusively in cinemas before it hits digital; this timeframe looks to be getting reduced further. Ted Sarandos comments on release windows: “My pushback has been mostly in the fact of the long exclusive windows, which we don’t really think are that consumer friendly, but when we talk about keeping HBO operating, largely as it is, that also includes their output movie deal with Warner Bros., which includes a life cycle that starts in the movie theater, which we’re going to continue to support.”

A Netflix-Warner Bros. Discovery merger also still has to honour the deal made with IMAX; in a new video from IMAX CEO Rich Gelfond mentions that “Warner Bros. has contracts through 2029, that guarantee a theatrical release, so no matter who owns Warner Bros. those contracts have to be honoured”.