Netflix says its position on Warner Bros deal has not changed

Netflix said its plan to acquire Warner Bros Discovery’s TV, film studios, and streaming assets remains unchanged, according to a letter from co-CEOs Greg Peters and Ted Sarandos to employees on December 15.

The company secured a US$72 billion deal for Warner Bros’ entertainment assets earlier in December, before Paramount Skydance made a separate US$108.4 billion hostile bid for the entire company.

Netflix will begin releasing Warner Bros movies in theaters after the deal closes, marking a shift from its previous streaming-only focus.

The company acknowledged possible regulatory scrutiny, but believes the acquisition is needed to compete more effectively with YouTube.

Attorneys cited in the report said US regulators may not view Netflix and YouTube as interchangeable rivals due to their differing business models.

Netflix said the merger would increase its US market share from 8% to 9%, still behind YouTube at 13%, and a potential Paramount-Warner Bros Discovery combination at 14%.

The company also said there are no current plans to close studios or cut jobs.

🔗 Source: Reuters

🧠 Food for thought

Implications, context, and why it matters.

Netflix agreed to buy Warner Bros. Discovery’s entertainment assets for $72 billion in cash and stock, with an enterprise value (a valuation measure that includes debt) of about $82.7 billion 1.
The deal would add nearly $11 billion in debt to Netflix 2. Sources give no detail on committed financing or credit rating risks from added leverage. That matters for the 12 to 18 month closing goal 1.
Netflix plans to include YouTube in the market definition, saying its US share would go from 8% to 9% while YouTube holds 13%. Antitrust attorneys (lawyers who specialize in competition law) warn regulators may see a gap between a subscription service and an ad-supported platform.

After closing, Netflix plans to release Warner Bros movies theatrically, reversing its streaming-only approach. It could spur demand for theatrical marketing, localization (subtitling and dubbing), and distribution tech from vendors.
Warner Bros plans 12 to 14 theatrical releases a year across four labels 3. The mix has 1 to 2 DC Studios films (Warner Bros’ superhero-focused unit), 3 to 4 New Line Cinema releases (the studio’s genre label), and 1 to 2 Warner Bros. Animation titles (the animation division) 3. Supergirl: Woman of Tomorrow and Clayface are on the 2026 slate. The Batman II targets 2027 3.
Vendors for theatrical distribution, real-time marketing, and multi-territory coordination can start outreach. Netflix will need to build functions that Warner Bros. runs through its integrated global distribution model (in-house international theatrical sales and marketing) 3.