WASHINGTON — A proposed $83 billion acquisition of Warner Bros. Discovery by Netflix has drawn sharp antitrust scrutiny from a U.S. Senate panel, with lawmakers warning that the deal could concentrate excessive market power in the hands of the world’s largest streaming company and reshape competition across the entertainment industry.
Senate Antitrust Subcommittee Chair Mike Lee said the transaction was “extraordinary in both scale and in potential consequence” and required close examination under federal antitrust law.
Speaking at a congressional hearing on Tuesday, Lee said the deal would give Netflix control over Warner Bros.’ film and television studios, its streaming operations and a vast library of iconic content. He warned that the merger raised horizontal antitrust concerns because Netflix and HBO Max compete directly for subscribers seeking premium films and scripted series.
Lee also highlighted labor market risks, noting that the companies compete for writers, directors and actors. Combining two major employers, he said, could weaken competition for creative talent and reduce bargaining power for workers across the industry.
In addition, Lee cited vertical antitrust risks, arguing that merging Netflix’s dominant global distribution platform with Warner Bros.’ content portfolio could disadvantage rival studios and streaming services. He said the combined company could withhold high-profile titles, raise licensing fees or favor its own programming through Netflix’s recommendation algorithms, even with small changes affecting visibility and competition.
Ranking Member Cory Booker said corporate concentration had reached levels not seen for generations and warned that selling Warner Bros. to a direct competitor could have “serious consequences for consumers and for the television and film industry.”
The New Jersey Democrat said consolidation has often resulted in higher subscription prices, fewer viewing options and diminishing opportunities for artists and creators. He also raised broader cultural concerns, arguing that another major merger could give a single corporation greater control over “what we see, what we hear and the news we consume,” while thousands of entertainment workers remain anxious about job security.
Defending the proposed deal, Netflix co-CEO Ted Sarandos told lawmakers that a combined Netflix and Warner Bros. would strengthen the U.S. entertainment industry, preserve consumer choice and create new opportunities for creators.
Sarandos said Netflix plans to operate Warner Bros.’ studios largely as they do today, maintain traditional 45-day theatrical release windows for major films and continue investing heavily in U.S.-based production. He added that the media market remains highly competitive, citing broadcast networks, rival streaming platforms and major technology companies.
According to Sarandos, Netflix currently accounts for about nine percent of U.S. television viewing time, a figure that would rise to roughly 10 percent following the merger. He said Netflix productions have generated more than 155,000 American jobs and contributed an estimated $225 billion to the U.S. economy.
Warner Bros. Discovery Chief Revenue and Strategy Officer Bruce Campbell told the panel that the company’s board unanimously concluded Netflix’s bid was the best option after reviewing competing offers. He said the transaction would pair Warner Bros.’ studios with Netflix’s streaming platform while still allowing for the planned separation of the company’s news and sports networks into a new entity.
Several senators pressed both executives on potential layoffs, subscription price increases and the long-term future of movie theaters. Lee and other lawmakers warned that the merger could divert major releases away from cinemas and toward streaming, reducing consumer choice. Sarandos countered that Netflix intends to support theatrical distribution and continue investing in a broad range of content.
The hearing comes as the U.S. Department of Justice and the Federal Trade Commission review the proposed merger, with bipartisan calls from lawmakers urging regulators to closely assess its impact on competition, prices, employment and the future of the entertainment industry. (Source: IANS)
