Netflix faced sceptical questioning from US lawmakers over its proposed $82bn (£61bn) takeover of Warner Bros Discovery, as senators raised concerns about competition, pricing, jobs, and the future of cinemas.
Bipartisan Concerns In Senate Hearing
On Tuesday, members of the US Senate antitrust subcommittee, from both major parties, warned that the merger could reduce competition, push up prices, and reshape the film exhibition business. The deal is currently under review by the Department of Justice, which holds the authority to approve or block it.
If completed, the acquisition would give Netflix control of Warner Bros’ film and television studios and the HBO Max streaming service. A rival bidder, Paramount Skydance, is continuing to press a competing offer to buy the company.
Questions On Theatres, Prices, And Jobs
During the hearing, senators questioned Netflix co-chief executive Ted Sarandos about the fate of cinemas, the potential impact on subscription prices, and the effect on the entertainment workforce.
Sarandos said Netflix would commit to releasing Warner Bros films in theatres for a 45-day window, which he described as the current industry standard, and said the studio would be run “largely as it is today.” He argued that combining the two companies would “give consumers more content for less,” pointing to the overlap between the two services, with 80% of HBO Max subscribers also paying for Netflix. He also said the merger would create more American jobs.
Republican Senator Mike Lee challenged that view, saying that consolidating two major employers in the same market would inevitably affect competition for labour and could weaken it.
Culture And Competition Debates
Several Republican senators focused on competition issues, while some also raised cultural concerns. Senator Eric Schmitt accused Netflix’s programming of being “overwhelmingly woke.”
Lawmakers also discussed whether Alphabet’s YouTube should be considered a major competitor to Netflix. Sarandos said Netflix competes with YouTube for content, viewers, and advertising spending, adding that YouTube has become a form of television rather than just a platform for short videos. Some senators, including Lee, said they were not convinced by that comparison, a position Paramount has also taken.
Paramount’s Absence And Rival Bid
One notable absence from the hearing was David Ellison, the chief executive of Paramount, which is still seeking to acquire Warner Bros despite earlier rejections. Paramount, backed by the Ellison family, has argued that its $108bn proposal is the stronger offer.
Democratic Senator Cory Booker said Ellison’s absence was “frustrating” and said he had declined an invitation to testify. Booker said that under either merger proposal, a single corporation would gain greater control over what audiences see, hear, and consume as news and entertainment.
Deal Structure And Regulatory Review
Netflix is seeking to fend off Paramount’s bid and last month revised its offer, saying it would fund the acquisition entirely in cash after earlier suggesting a mix of cash and shares.
The Senate hearing underscored the bipartisan unease surrounding the transaction, but the final decision rests with the Department of Justice as it continues its antitrust review.
Featured image credits: Heute.at
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