Netflix has reached an agreement to acquire Warner Bros. Discovery’s studios and HBO Max streaming operations for $83 billion at $27.75 per share, marking the streaming giant’s first major studio acquisition and triggering alarm across the theatrical exhibition industry. The deal, which requires U.S. regulatory approval, prompted producers to petition Congress with a warning that Netflix’s priorities differ from those of traditional studios, particularly in how and where films are made accessible to audiences, a shift they believe threatens the survival of movie theaters worldwide. The fundamental threat to theatrical exhibition stems from Netflix’s subscription-based business model, which generates revenue exclusively from monthly subscriber fees. The acquisition follows a weeks-long bidding war between Netflix, Paramount, and Comcast for Warner Bros. Discovery’s prized assets. The deal would hand Netflix control of one of Hollywood’s legendary studios, the HBO Max streaming platform, and content libraries spanning decades of theatrical filmmaking, from classic Warner Bros. productions to DC Universe superhero franchises. Why Netflix has zero incentive for theaters The fundamental threat to theatrical exhibition stems from Netflix’s subscription-based business model, which generates revenue exclusively from monthly subscriber fees. This creates a direct conflict with traditional theatrical distribution economics that producers highlighted in their congressional letter. Box office performance becomes a secondary metric for Netflix, since its financial outcomes are tied to subscriber retention rather than ticket-driven revenue. Worse, every week a Warner Bros. film plays exclusively in theaters represents a week Netflix subscribers cannot access that content on the platform they’re already paying...
Published By: CineD - Today