Netflix in Exclusive Talks to Acquire Warner Bros
Netflix has entered exclusive negotiations to purchase Warner Bros Discovery’s film and television studios along with the HBO Max streaming service in what would mark one of the largest media consolidations in recent history. The streaming giant is offering a five billion dollar breakup fee should regulatory authorities block the transaction.
The deal positions Netflix ahead of competing bidders Paramount Skydance and Comcast, both of which had submitted offers for the entertainment assets. Warner Bros Discovery, valued at over sixty billion dollars, plans to complete a spinoff of its cable television networks including CNN, TBS and TNT before finalizing any sale.
Should the acquisition proceed, Netflix would gain control of HBO’s premium content library featuring programming such as The Sopranos and The White Lotus. The transaction would also transfer ownership of Warner Bros’ production facilities in Burbank, California, along with an extensive archive of films and television shows including the Harry Potter franchise and Friends.
The potential merger represents a significant departure from Netflix’s historical business model. The company built its four hundred thirty-seven billion dollar market valuation by licensing content from studios before developing original programming, never previously attempting an acquisition of this magnitude.
Paramount Skydance executives have raised objections to the sale process, claiming Warner Bros conducted negotiations that unfairly favored Netflix. The company filed correspondence with Warner Bros management alleging procedural irregularities in how bids were evaluated and suggesting the auction design advantaged the streaming platform.
Traditional television operations continue facing financial pressure as consumers migrate toward streaming platforms. Warner Bros’ cable division reported a twenty-three percent revenue decline in its most recent quarter as subscriber cancellations accelerated and advertising spending shifted to digital channels.
Regulatory scrutiny appears certain given the combined entity’s market dominance. California Representative Darrell Issa has formally notified federal regulators of concerns that the merger could harm consumer interests. Utah Senator Mike Lee has similarly expressed reservations about potential competitive effects.
Netflix executives have argued their true competition extends beyond traditional media companies to include platforms like YouTube. The company maintains that acquiring Warner Bros content would enable more competitive pricing through bundled offerings rather than limiting consumer choice.
The streaming service operates with fundamentally different distribution strategies than legacy studios. Netflix rarely releases theatrical films, typically providing only limited cinema runs for select original productions, a practice that has generated anxiety throughout Hollywood’s traditional exhibition sector.
Bloomberg Intelligence analysts estimate Netflix may have bid thirty dollars per share for Warner Bros assets, implying a seventy-five billion dollar equity valuation. A combined subscriber base approaching four hundred fifty million users would likely trigger comprehensive antitrust review in both United States and European markets.
Netflix reported thirty-nine billion dollars in revenue for 2024, matching Warner Bros’ annual sales figures despite the latter company’s century-long operating history dating to the 1920s. The streaming platform evolved from a mail-order DVD rental service launched three decades ago into the entertainment industry’s most valuable enterprise.
Both companies could announce a finalized agreement within days if negotiations proceed smoothly. The timeline remains subject to continued discussion between parties and depends on resolution of outstanding commercial terms.
