If Netflix is allowed to complete its purchase of Warner Brothers, removing competitors and restricting access to essential content libraries could create a monopoly, as per the several state attorneys general.
- The letter further said that the merger could be “disastrous for the theatrical motion picture business”, citing Netflix’s historic reluctance to put its movies in cinemas.
- The 11 states include Nebraska, Montana, Alabama, Alaska, Iowa, Kansas, North Dakota, South Carolina, Tennessee, Utah and West Virginia.
- The letter said that the proposed Netflix merger with Warner Bros threatens the dominance of the United States as 'the world leader in movies'.
Several state attorney generals in the U.S. are raising concerns about the proposed acquisition of Warner Bros Discovery by Netflix, saying the deal will harm consumers.
Nebraska Attorney General Mike Hilgers, alongside Montana Attorney General Austin Knudsen, led an 11-state coalition in sending a letter to the U.S. Department of Justice, asking it to thoroughly scrutinize Netflix’s proposed merger with Warner Brothers.
The 11 states include Nebraska, Montana, Alabama, Alaska, Iowa, Kansas, North Dakota, South Carolina, Tennessee, Utah and West Virginia.
Concerns
If Netflix is allowed to complete its purchase of Warner Brothers, removing competitors and restricting access to essential content libraries could create a monopoly. This may result in higher subscription costs and less, lower-quality content for the State’s residents, the letter said.
The letter further said that the merger could be “disastrous for the theatrical motion picture business”, citing Netflix’s historic reluctance to put its movies in cinemas.
Netflix, however, has pledged to release Warner Bros. movies in theatres exclusively for 45 days.
As per the letter, the United States remains “the world leader in movies” and Netflix’s quest to become “the one platform to rule them all” through its acquisition of Warner Brothers threatens this dominance.
Battle For WBD With Paramount
Netflix is under significant pressure from Paramount Skydance to acquire Warner Bros., particularly following Paramount’s recent $31-per-share offer. This new bid has led Warner Bros. to suggest that Paramount’s proposal might be more favorable than Netflix’s offer.
“I agree the reason WBD Board suddenly relented and allowed PSKY back into the bidding for WBD is the obvious anti-trust hurdles in getting the $NFLX- $WBD deal closed in a reasonable amount of time,” The Future Fund Managing Partner Gary Black said in an X post on Wednesday.
How Did Stocktwits Users React?
On Stocktwits, retail sentiment around WBD and NFLX stock trended in ‘extremely bullish’ territory at the time of writing, while for PSKY, it trended in ‘bullish’ territory.
Shares of PSKY and NFLX have fallen 11% and 17%, respectively, in the past year. Meanwhile, WBD shares have risen 160% over the same period.
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