On 5/12, Netflix announced a massive deal to acquire the television, film studio, and streaming divisions of Warner Bros. Discovery (WBD) for 72 billion USD. This agreement sent shockwaves through Hollywood, signaling a major shift in the entertainment industry.
WBD is a leading American media and entertainment conglomerate, owning Warner Bros. film studio, HBO, HBO Max, Discovery Channel, CNN, and various other cable television channels. The company was formed in 2022 after the merger of WarnerMedia and Discovery. Netflix, meanwhile, stands as the world's largest streaming platform, boasting over 300 million subscribers across more than 190 countries.
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Netflix will spend 72 billion USD to acquire a part of Warner Bros. Discovery. Photo: Deadline |
Warner Bros. Discovery confirmed it would proceed with its plan to split in 2026. Following the separation's completion next summer, Netflix will take ownership of the Warner-related assets. The remaining entity, named Discovery Global, will encompass CNN and other cable television channels.
The proposal from Netflix came as a surprise to industry observers, as other media giants like Paramount and Comcast were also pursuing WBD. For several weeks, Paramount was considered the frontrunner, with its leadership expressing confidence in acquiring the entire company, including its cable television division. CNN sources revealed that Netflix submitted two offers earlier this week, both valued higher than Paramount's.
Netflix also agreed to a breakup fee, meaning it would pay WBD billions of USD if the deal failed. This substantial commitment underscores the challenges the acquisition faces, particularly legal scrutiny. The US government and other relevant countries will need to review the transaction. Senator Mike Lee expressed concern on X, stating, "Netflix's desire to acquire its competitor - WBD's streaming division - will put antitrust officials worldwide on high alert. If this deal goes through, it will raise major questions about competition."
Despite potential hurdles, Netflix's leadership affirmed on 5/12 that both parties possess complementary assets, believing the deal will create "more opportunities for the content creation community." However, Cinema United, an association representing cinema owners, views the acquisition as "an unprecedented threat to global cinemas," citing Netflix's historical reluctance to release films in theaters.
This acquisition could effectively conclude one of the media industry's biggest rivalries of the past decade. A recent Bank of America report declared: "The streaming wars are effectively over. Netflix will become Hollywood's undisputed global force, far surpassing its current position."
Ha Thu (according to Reuters, CNN)
