by Julia Jay Pierrepont III
LOS ANGELES, Dec. 5 (Xinhua) -- Netflix sent shockwaves through Hollywood on Friday by announcing an 82.7 billion-U.S.-dollar agreement to acquire Warner Bros., including its film and television studios, the century-old home of "Superman," "Casablanca," and "Harry Potter."
The acquisition also includes Home Box Office (HBO), the premium U.S. television network and streaming service, along with HBO Max and its prestige series such as "Game of Thrones," "The Sopranos," and "The White Lotus."
According to a press release from Netflix, the cash-and-stock deal values Warner Bros. Discovery at 27.75 dollars per share. The acquisition is expected to be completed after Warner Bros.'s TV network business is spun off into a separate public company, Discovery Global, which will include CNN, TNT and the Discovery networks.
The transaction is subject to regulatory approval by the U.S. Department of Justice, the Federal Trade Commission and Warner Bros. Discovery shareholders. If approved, the deal could close in the third quarter of 2026.
Once finalized, Netflix would control two major streaming services and potentially command more than 420 million subscribers, far surpassing competitors such as Disney+, Paramount+, Apple TV+, Prime Video and Peacock.
"The deal would boost Netflix's studio power, production capacity and theatrical output while shaking up Hollywood," the Los Angeles Times commented Friday. "Netflix is taking a massive swing at the future of entertainment, and Hollywood will never be the same."
Friday's announcement does not end the fierce bidding war involving Paramount Skydance and Comcast. Bloomberg and Variety reported that Paramount Skydance has protested the sales process, labeling it "tainted."
The merger has triggered intense speculation in Hollywood about its impact on the film industry.
"Netflix has always been an industry disruptor," Artisha Mann-Cooper, one of the producers of the U.S.-China cross-cultural comedy "Mr Fun," told Xinhua.
A major question centers on theatrical strategy. Netflix traditionally favors streaming-first releases with limited or no theatrical runs, while Warner Bros. relies on lengthy theatrical windows for its blockbuster franchises.
A-list Hollywood producer Arthur Sarkissian -- known for the "Rush Hour" franchise starring Jackie Chan and "Memory" starring Liam Neeson -- expressed mixed feelings. "Netflix makes exceptional series, but they don't love movies the way many of us do," he told Xinhua. "If they just pick projects by crunching numbers, that won't deliver the high-quality, story-based movies people want to see in theaters for that unique shared thrill or laugh."
Jeff Most, a leading indie producer behind "The Crow" franchise, agreed. "I have tremendous respect for what Netflix has achieved. As producers, many of my peers and I are counting on Netflix to stand by its word to continue to use Warner Bros. for theatrical releases. Losing a major distribution outlet would be a tremendous loss to the industry and the world."
Netflix CEO Ted Sarandos has signaled that theatrical windows might become "more consumer-friendly," sparking alarm among theater owners who depend on long exclusive runs. Cinema United, representing tens of thousands of screens worldwide, called the merger an "unprecedented threat" to theaters.
"We want to encourage the theatrical experience globally," Most added. "It means more films in a healthier marketplace and more opportunity for diverse voices and audiences to benefit from the unique wonders of a shared theatrical experience."
Many producers and guilds share similar concerns. An anonymous group of Hollywood producers warned Congress that Netflix has "no incentive" to support theatrical exhibition, which could threaten the survival of the cinema industry.
The Writers Guild of America said the deal epitomizes the dangers antitrust laws are meant to prevent, predicting fewer jobs, declining wages, reduced creative diversity and higher consumer prices. Further consolidation, the guild argued, would leave viewers with fewer choices and creators with diminished bargaining power.
Evelyn Xu, a producer of the Chinese-themed period drama "Swallowtail & Dragonfly," told Xinhua that the deal could be a double-edged sword. "With Netflix buying Warner Bros., there's a chance for more investment in original movies, but it could also make things tougher for independent producers," she said, noting that fewer distributors would limit funding opportunities and outlets for their projects.
Erik Lundmark, owner of Leomark Studios -- a boutique distribution company that executive-produced and distributed films including "Gingersnap Christmas" -- voiced similar concerns.
"We're back to the early days of Hollywood, where studios and now major streamers control both production and exhibition," he said. "How do you compete with that?"
Itzy Flores Torres, an indie producer based in Mexico, offered a more optimistic view. "Netflix just signed a deal to supply major funding for Mexican productions, so this could be good for the whole Mexican entertainment industry, and other international co-productions," he told Xinhua. ■
