Netflix and HBO Max are two of the top streaming subscription services – Amazon Prime Video and Disney+ are No. 2 and 3. What happens if Netflix acquires Warner Bros. Discovery? Could services merge?
How Netflix acquiring Warner Bros. could reshape Hollywood
In a deal worth $72 billion, Netflix announced that it will be purchasing legendary Hollywood studio Warner Bros. which includes HBO and HBO Max.
- Netflix has announced a $72 billion deal to acquire Warner Bros. Discovery and its popular franchises.
- The merger would combine Netflix’s 300 million subscribers with HBO Max’s nearly 130 million subscribers.
- The deal faces potential challenges from regulators and Hollywood guilds over antitrust concerns.
Netflix and chill? Not anymore. After decades of organic growth, the streaming giant has gone on the offensive with a $72 billion merger deal for Warner Bros. Discovery, which owns several popular franchises, including Batman, Superman, Wonder Woman and Harry Potter.
The Netflix-Warner Bros. Discovery transaction would reshuffle the entertainment landscape, rounding up classics such as “Casablanca” and beloved HBO series “Game of Thrones” and “The Sopranos” under the streaming service’s umbrella. The deal would also bring more consolidation to the video streaming space by adding HBO Max’s nearly 130 million streaming subscribers to Netflix’s 300 million or so.
The companies expect the merger to be completed in the third quarter of 2026, after Warner Bros. Discovery splits off its Global Networks division, which includes CNN, Discovery Channel, TBS and TNT, from the studios division.
But the dominance posed by a potential Netflix-HBO Max streaming juggernaut – along with concerns about implications for the movie theater industry – may pose challenges to the deal being approved by regulators.
The Netflix-Warner Bros. deal would give the combined streaming service “a huge library” of Warner Bros. films, Kathryn Harrigan, Henry R. Kravis Professor of Business Leadership at Columbia Business School, told USA TODAY. “It’s going to be a bigger library than anybody else has.”
What happens to HBO Max after the Netflix deal?
That remains to be seen. For now, the two streaming services will remain separate, Netflix said in a letter to subscribers delivered via email early Saturday, Dec. 6.
“Nothing is changing today. Both streaming services will continue to operate separately. We have more steps to complete before the deal is closed, including regulatory and shareholder approvals,” read the letter, which included a link to a Netflix FAQ about the merger.
“Nothing is changing with content currently on Netflix. Netflix and Warner Bros. will remain separate until the transaction is closed,” the FAQ read.
Answering the question whether HBO Max subscribers should cancel their membership, the FAQ reads: “Netflix and Warner Bros. will remain separate until the transaction is closed.”
That seems to leave open the possibility for integration. But Netflix co-CEO Gregory Peters said during a Dec. 5 teleconference discussing the merger that the HBO brand “is very powerful for consumers.”
Netflix and HBO Max “are very complementary,” he said, adding there is “a high overlap of existing HBO Max subscribers who are also Netflix subscribers.”
With two independent streaming services, Netflix could create programming bundles to help retain subscribers of both services, and get customers who subscribe to one to add the other. “There’s a real opportunity we think of actually figuring out how do we bring more of those titles in the right way through some combination of plans and tiering, et cetera, to unlock the value in those assets,” Peters said.
Big picture: Netflix deal for Warner Bros. Discovery faces challenges
There’s no guarantee the deal will pass regulatory scrutiny. Voices from across the political spectrum have found fault with the merger. Sen. Elizabeth Warren, D-Mass., called the merger “an anti-monopoly nightmare,” arguing that a combined Netflix–Warner Bros. would hurt consumers.
The Trump administration hasn’t issued an official public response, but after the deal was announced, CNBC reported a senior administration official viewed the merger with “heavy skepticism.”
Paramount, which completed its own $8.4 billion merger with Skydance Media in July, had also been involved in bidding for Warner Bros. Discovery over the last two months – as had Comcast, Reuters has reported.
Paramount Skydance CEO David Ellison, who, like his father, Oracle founder Larry Ellison, has close ties with the Trump administration, has argued that the mass media conglomerate’s acquisition of Warner Bros. Discovery posed the least antitrust concerns.
In a letter to Warner Bros. Discovery, Paramount lawyers said a Netflix deal would “entrench and extend Netflix’s global dominance in a matter not allowed by domestic or foreign competition laws,” The Wall Street Journal reported on Dec. 4.
Hollywood is voicing its concerns, too. “The potential Netflix/Warner Bros transaction is a consolidation that may serve the financial interests of shareholders of both companies, but which raises many serious questions about its impact on the future of the entertainment industry, and especially the human creative talent whose livelihoods and careers depend on it,” said the Screen Actors Guild & American Federation of Television and Radio Artists in a statement on X on Dec. 5.
But Netflix co-CEO Ted Sarandos stressed that “this deal is pro-consumer, pro-innovation, pro-worker, pro-creator and pro-growth” and that consumers would be able to subscribe to Netflix, HBO Max and other Warner Bros. Discovery packages, increasing “value for consumers.”
Netflix would continue releasing Warner Bros. Discovery films going forward, he said, hoping to dispel fears that the deal would eliminate another studio and major source of theatrical films.
Contributing: Daniel de Visé and Kelly Lawler/ USA TODAY
Mike Snider is a national trending news reporter for USA TODAY. You can follow him on Threads, Bluesky, X and email him at mikegsnider & @mikegsnider.bsky.social & @mikesnider & msnider@usatoday.com
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