Warner Bros. had put itself up for sale over the past few months, and this morning, we learned which company has earned the right to purchase the landmark studio: Netflix.
The world’s largest streaming service has agreed to purchase Warner Bros. for a whopping $82.7 billion — more than $10 billion more than what Disney paid out for 21st Century Fox in 2019 (via The Hollywood Reporter). Netflix emerged as the winner ahead of rivals like Paramount (which was recently purchased by the Ellisons through their production house Skydance), Apple, and Amazon, a move that has already brought controversy and objections over whether the process was fairly drawn out. While there are plenty of regulatory hurdles to jump through, Netflix seems fairly secure in this deal, agreeing to pay nearly $6 billion to WB should the purchase fall through.
It’s unclear exactly what will change in the entertainment industry as fallout from this deal, but some amount of changes to how WB distributes their films seems inevitable. While Netflix has stated that it plans to “maintain” the theatrical release of Warner Bros. movies, co-CEO and founder Ted Sarandos is on record — as recently as this year — stating his general distaste for the theatergoing experience. Likewise, the company line has already started to imply that shorter theatrical windows would be coming to Netflix’s new output, potentially using the recent launch of Wake Up Dead Man as a template moving forward.
As for the rest of WB’s business, it’s a little less clear. HBO Max (née Max, née HBO Max the first time) would remain a separate streaming service for the time being, though it’s hard to imagine it not being folded into Netflix at some point post-acquisition. As for its cable business (think CNN, Cartoon Network, and so on), Warner Bros. is continuing to split its Discovery brand off into its own venture, largely to avoid dealing with its mounting debt as traditional TV continues its slow descent into irrelevance.
It’s certainly unclear whether the current US Justice Dept. will allow this deal to go through, with some reports suggesting DOJ meetings have already begun in opposition to this deal. Should Warner Bros. be absorbed into Netflix, though, expect the entertainment industry to go through its biggest shakeup since that Disney-Fox merger — one that could have even larger ramifications for the future of TV, streaming, and movie theaters.
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