Just a few weeks ago, Paramount, NBC Universal, and Netflix were engaged in a bidding war for Warner Bros. Discovery. While Paramount seemed like the frontrunner due to its favorable relationship with President Trump and its interest in the entire Warner Bros. catalogue, Netflix announced hours ago that it has a deal with Warner Bros. Discovery in place. To acquire the film and television studio and assets such as HBO Max and Netflix, the company will pay $72 billion, including a $12 billion premium, even though the company’s market capitalization yesterday was $60 billion. What Netflix will not own, however, is the Discovery Global half of Warner Bros. Discovery. This means that Warner’s cable channels, like CNN, will remain up for grabs, making the split Warner Bros. CEO David Zaslav has always talked about finally tangible. Additionally, should this deal not go through, Netflix has agreed to pay a $5.8 billion breakup fee.
The response to this deal has largely been negative, though there is a sentiment of relief that Paramount did not claim victory. I would like to emphatically state that this is not a win in the slightest. Should this deal pass, it will be a dark day for the future of television and cinema. Netflix has already begun transforming the way television is experienced, as the binge-release model popularized by the platform encourages consuming art quickly rather than experiencing it week to week. Other companies have begun adopting this strategy for their smaller titles, with Peacock’s “The Paper“ and FX’s“English Teacher“ recently releasing as binge drops, even though the assumption had been that they would air episodes weekly. HBO Max has typically been the exception, as “HBO Sundays“ have been central to the studio’s core appeal: prestige, event television that everyone watches at the same time on Sunday nights, to discuss the latest episode on Monday mornings at the water cooler. In the wake of this deal, it is uncertain if HBO Max will even continue to exist. Experiencing “The Rains of Castamere”-level episodes for the first time as a 10-episode binge drop may be in your future.
And then, there is cinema. The theatrical experience has already begun to die out, as audiences increasingly choose to stay at home rather than go to theaters, under the assumption that the year’s biggest releases will eventually find their way to streaming services. Warner Bros. has had a banner year at the box office; however, “Sinners”, “A Minecraft Movie”, “Weapons”, “Superman”, and “One Battle After Another“ all grossed over $200 million worldwide. The mix of recognizable IP and original stories from some of this decade’s most exciting filmmakers has made for a phenomenal, highly profitable slate. Meanwhile, Oscar-winning director Guillermo del Toro’s newest film, “Frankenstein,” received a limited theatrical release three weeks before its Netflix premiere. Many viewers saw his grand vision as it was always meant to be screened…on their iPhone. And it is not as if Netflix films have not done well at the box office. “KPop Demon Hunters“ and “Glass Onion: A Knives Out Mystery“ were successful for the handful of days they were in cinemas across the nation. Though Netflix is not going to do away with theatrical releases, the company has already announced plans to shorten the exclusive window of theatrical releases as a way to be “more consumer-friendly”. Considering that a monthly streaming service subscription costs less than a single cinema ticket, it is a fair point on paper. But isn’t the experience of seeing singular visions in the grand format they were always meant for worth the ticket price?
That said, there are a number of antitrust laws in place to prevent acquisitions like these. When the top streaming platform acquires one of its largest competitors, there is an argument to be made that it constitutes anti-competitive conduct. And due to President Trump’s favoring of Paramount in this bidding war, the company has attested that, before this announcement, it was unlikely that regulatory agencies would approve deals from competitors. It remains to be seen if this is just bluster. But no matter what the outcome is for Warner Bros., one thing remains clear: the future of cinema and television has been dramatically altered today.Â
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