Paramount Global has formally expressed its opposition to the proposed acquisition of Warner Bros. Discovery (WBD) assets by Netflix. On March 6, 2024, the company submitted a letter to the House Judiciary Antitrust Subcommittee, asserting that the deal could violate antitrust laws and could solidify Netflix’s dominance in the streaming industry.
In the letter, written by Makan Delrahim, Paramount’s chief legal officer, the company described Netflix’s planned acquisition as “presumptively unlawful.” Delrahim argued that allowing Netflix to acquire WBD assets would significantly enhance its market power in streaming video on demand (SVOD). The timing of the letter coincided with a subcommittee hearing focused on the current state of the streaming market, where the potential sale of WBD was a prominent topic of discussion.
Paramount representatives did not appear before the subcommittee during the hearing. The company is keenly aware of the implications that Netflix’s enhanced market position could have on competition. The debate centers around whether the government perceives Netflix as the dominant player in the SVOD market or as a competitor to platforms like YouTube and social media networks, including TikTok and Instagram.
Last month, Warner Bros. Discovery announced its agreement with Netflix, which involves the latter acquiring the studio and its streaming assets. Under this arrangement, WBD’s cable channels are to be separated into a distinct entity. This move has raised concerns among competing media companies about the potential for reduced competition and higher barriers for new entrants seeking to capture audience share in the streaming landscape.
The outcome of this situation hinges on legislative perspectives regarding media consolidation and market competition. Paramount’s intervention reflects a broader anxiety within the industry about the future of streaming and the balance of power among major players.
As the House Judiciary Antitrust Subcommittee continues to evaluate the implications of the Netflix-WBD deal, industry watchers will be paying close attention to how regulators respond to Paramount’s concerns. The final decision could set significant precedents for future media mergers and acquisitions in an ever-evolving digital landscape.
