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International Business Times
International Business Times
Business

Netflix's Acquisition of Warner Bros. Discovery Faces Scrutiny From White House Officials

Netflix is set to open two enormous entertainment venues in the United States next year.

Netflix's plan to acquire Warner Bros. Discovery, including the HBO Max streaming service, is facing close attention from senior White House officials, who are raising questions about the potential impact on competition in Hollywood.

Sources told the NY Post that officials recently held a high-level meeting to discuss whether Netflix's growing influence could give it too much control over the entertainment industry.

"Basically, everyone agreed that Netflix presents unique antitrust concerns and if it won the bidding war, it would be one long slog and touch off an investigation along the lines of those of Google and Amazon," said a government official present at the meeting.

The official added, "Netflix already has market dominance, but if you add a major streaming service that would stifle competition at some point."

The meeting comes as Warner Bros. Discovery's board prepares to receive a second round of offers for the company, which owns the top-ranked Warner Bros. studio, HBO Max, and a range of cable channels including CNN and HBO.

Netflix is expected to submit a sweetened bid for the studio and streaming service, while competitors such as Paramount Skydance and Comcast are also preparing offers.

Paramount Skydance, led by David Ellison and his father Larry Ellison, initially bid $23.50 per share, and Comcast's offer faces regulatory challenges due to previous political scrutiny of its channels.

DOJ May Probe Netflix Over Warner Bros. Deal

Netflix, founded 28 years ago by Reed Hastings and now led by CEO Ted Sarandos, is the world's largest streaming platform with 300 million subscribers, Mint reported.

White House officials noted that the company's size could limit competition in streaming, especially as more Americans shift from cable TV to online platforms.

There are also concerns about potential pushback from European regulators.

Sarandos and Netflix legal teams have argued that antitrust laws may not fully apply to streaming services because of competition from platforms like YouTube and TikTok, a concept known as "category ambiguity."

While this argument has found some support with Warner Bros. Discovery board members, senior White House advisers remain skeptical.

Officials are particularly concerned about Netflix's influence over content creators, talent, and program negotiations in Hollywood.

If Netflix wins the bid, the deal could trigger a lengthy investigation by the Department of Justice's antitrust division, possibly expanding to examine Netflix's broader business operations.

A media insider noted that a failure to secure Warner Bros. content could leave Netflix at a disadvantage compared to competitors controlling large, high-quality libraries.

Originally published on vcpost.com

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