What's happened
On December 5, 2025, Netflix announced a $72 billion deal to acquire Warner Bros. Discovery's studio and streaming assets, including HBO and HBO Max. The acquisition excludes Warner's cable networks, which will be spun off. The deal, expected to close in 12-18 months, faces regulatory scrutiny amid concerns over market consolidation and competition.
What's behind the headline?
Strategic Shift for Netflix
Netflix's acquisition of Warner Bros. marks a fundamental transformation from a content licenser and original producer to a major Hollywood studio owner. This move secures long-term control over valuable intellectual property, including HBO's acclaimed series and Warner's extensive film library, addressing Netflix's previous lack of multigenerational IP.
Industry Consolidation and Market Power
The deal consolidates two of the largest streaming platforms, Netflix and HBO Max, potentially reducing competition and raising antitrust concerns in the US and Europe. Netflix's promise to maintain theatrical releases aims to mitigate fears of diminished cinema presence, but skepticism remains among industry stakeholders.
Regulatory and Political Challenges
The acquisition faces intense scrutiny, with rivals like Paramount alleging an unfair bidding process and lobbying for regulatory intervention. The involvement of political influence, particularly in the US, adds complexity to the approval process, potentially delaying or blocking the deal.
Impact on Consumers and Content
If approved, Netflix subscribers will gain access to a vastly expanded content library, including classics and new productions, enhancing value. The merger is expected to generate significant cost savings and increase Netflix's production capacity, potentially benefiting creative talent and audiences.
Future Outlook
This acquisition will likely trigger further consolidation in the media industry as legacy companies struggle against tech-backed giants. Netflix's success in integrating Warner Bros. will determine its ability to sustain growth and fend off competition from Disney, Paramount, and others.
What the papers say
According to Ted Sarandos, Netflix co-CEO, the deal is a "rare opportunity" to "entertain the world" better by combining Netflix's hits like "Stranger Things" with Warner Bros.' classics such as "Casablanca" and "Harry Potter" (The Times of Israel, The Independent). David Zaslav, Warner Bros. Discovery CEO, described the merger as combining "two of the greatest storytelling companies" (France 24, The Independent). However, Paramount Skydance, a rival bidder, accused Warner Bros. of an "unfair auction process" favoring Netflix and questioned the sale's regulatory prospects (The Guardian, Business Insider UK). Critics, including Cinema United and director James Cameron, warned the deal threatens theatrical exhibition and Hollywood's competitive landscape (The New Arab, Sky News). Netflix has pledged to continue theatrical releases and argued the merger would benefit consumers by offering bundled streaming services and more content (Reuters, The Times of Israel). The deal's $82.7 billion valuation includes $23.25 per share in cash and $4.50 in Netflix stock, with closing expected after Warner Bros. spins off its cable networks (AP News, Reuters).
How we got here
Netflix, founded in the late 1990s as a DVD rental service, evolved into a streaming giant without owning a major content library. Warner Bros., a century-old Hollywood studio with iconic franchises like Harry Potter and DC Comics, put itself up for sale in October 2025. The deal follows a competitive bidding war involving Paramount Skydance and Comcast.
Go deeper
- What are the main regulatory challenges facing the Netflix-Warner Bros deal?
- How will this acquisition affect movie theaters and theatrical releases?
- What does this mean for Netflix subscribers and content availability?
More on these topics
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Netflix, Inc. is an American technology and media services provider and production company headquartered in Los Gatos, California. Netflix was founded in 1997 by Reed Hastings and Marc Randolph in Scotts Valley, California.
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Theodore Anthony Sarandos Jr. is an American businessman who serves as the co-chief executive officer and chief content officer for Netflix.
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Warner Bros. Discovery is an upcoming American multinational mass media and entertainment conglomerate. The company will be formed though the merger of WarnerMedia and Discovery, Inc., which is expected to be completed by mid-April 2022.
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David M. Zaslav is the president and chief executive officer of Discovery Inc., a position he has held since January 2007.
Most recently under Zaslav, Discovery acquired Scripps Networks Interactive, in a transaction which closed in March 2018.
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Home Box Office is an American pay television network owned by WarnerMedia Studios & Networks Group and the flagship property of parent subsidiary Home Box Office, Inc.
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HBO Max, is an American subscription video on demand streaming service from AT&T's WarnerMedia. The service launched on May 27, 2020.
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ViacomCBS Inc. is an American diversified multinational mass media conglomerate formed through the merger of CBS Corporation and the second incarnation of Viacom in 2019, which were split from the original incarnation of Viacom in 2005.
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Warner Bros. Entertainment Inc., is an American diversified multinational mass media and entertainment conglomerate headquartered at the Warner Bros.
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Lawrence Joseph Ellison is an American business magnate, investor, and philanthropist who is a co-founder and the executive chairman and chief technology officer of Oracle Corporation.