After months of denial on their part, it’s now abundantly clear that Netflix wants to buy portions of Warner Bros. Discovery. Netflix CEO Ted Sarandos is evaluating a bid—but only for the divisions that make strategic sense to them (the studio and streaming assets), not the legacy TV networks. And Warner Bros. is listening.
If Netflix were to take control of Warner Bros., the consequences for the film industry could be grim. Unless, of course, Netflix decided to use Warner Bros. as a theatrical-release arm—which it won’t. Netflix’s end goal has long appeared to be the erosion of theatrical exhibition. Far more likely is that Warner Bros.’ film legacy would be folded into Netflix’s streaming-first strategy.
Yet here’s a Bloomberg report claiming that Netflix has told Warner Bros. Discovery executives it plans to keep the studio’s films in theaters if the purchase goes through, according to sources familiar with the discussions.
Does anybody actually believe this? Will Netflix—Voldemort to exhibitors—really keep its word and release Warner Bros. titles in theaters? Maybe. But do their standard one- to two-week limited runs in a few hundred theaters even count?
Studios and exhibitors fear that a Netflix takeover of Warner Bros. would erase another major supplier of theatrical releases. Netflix has historically allowed only brief theatrical windows, mainly to qualify for awards and appease filmmakers. Why would they behave any differently here? Sarandos has repeatedly called theaters a shrinking business and maintains that Netflix’s top priority is serving its streaming customers.
If Netflix ultimately gains control of Warner Bros., the outcome for the industry may indeed be bleak. It would be one of the most effective ways for Sarandos to further diminish the theatrical experience. More likely than not, Warner Bros.’ historic film identity would be reabsorbed into Netflix’s streaming-centric model.
A few weeks ago, Netflix reportedly retained financial advisory firm Moelis & Co. to explore a potential bid for Warner Bros.’ studio and streaming operations. Moelis, notably, is the same investment bank that advised Skydance Media during its successful takeover of Paramount.
We’re still a long way from this nightmare becoming reality—but, honestly, it has become a real possibility. Paramount has already seen three bids rejected, with a fourth—reportedly around $71 billion—said to be in the works.