In an unprecedented move that is set to change the entertainment industry as we know it, Netflix has completed the acquisition of Warner Bros. in a colossal $82.7 billion transaction. The deal, announced on Friday, encompasses Warner Bros.’ film and television studios, HBO, and HBO Max, thus giving Netflix control over a treasure trove of American cultural staples such as Game of Thrones, Harry Potter, The Wizard of Oz, and the DC Universe.
Netflix co-CEO Ted Sarandos hailed the acquisition as a "historic union" that will not only provide viewers with more choices but also breathe fresh life into the industry. Sarandos emphasized the importance of Warner Bros.’ legacy and expressed enthusiasm about the potential of combining classic franchises with Netflix's contemporary hits to "define the next century of storytelling."
The streaming giant has stated its intention to maintain Warner Bros.’ current operations, indicating that theatrical film releases will continue alongside streaming content. Greg Peters, Netflix's other co-CEO, described the acquisition as a strategic move to "accelerate" Netflix's dominance in the market and to expand the horizon for directors, actors, and creators.
From an industry perspective, the deal is being framed as a win-win situation. Executives are optimistic that the merger of Warner Bros.’ extensive library with Netflix's global platform will not only create more jobs but also provide more space for creative projects. Warner Bros. CEO David Zaslav supported the merger, suggesting it as a cultural triumph that will ensure the longevity of world-renowned franchises for future generations.
The acquisition is also expected to make Netflix more competitive in both original content creation and theatrical releases, bolstering the studio capabilities that the streamer has been building since 2018. With a wider platform for creators to work with beloved intellectual property, the merger aims to reach an even larger global audience.
Financially, Netflix anticipates that the deal will increase membership, drive revenue, and reduce costs. The company projects annual savings of $2 to $3 billion by 2028. As part of the agreement, Warner Bros. shareholders will receive a combination of cash and Netflix stock, with the purchase pricing Warner Bros. at $27.75 per share.
This acquisition follows Warner Bros.’ decision to spin off its Global Networks division, which includes CNN and TNT Sports, into a separate publicly traded entity known as Discovery Global. Consequently, CNN will remain outside of Netflix's purchase, a move that some industry analysts believe could leave the cable network vulnerable as streaming services continue to consolidate their hold over entertainment.
The Netflix-Warner Bros. deal is anticipated to close within 12 to 18 months, pending regulatory approval. However, some voices are raising concerns over the implications of this historic takeover. Conservative commentator Benny Johnson called the merger "the most dangerous media consolidation in American history," highlighting potential risks associated with such a significant concentration of media power.
