Would the acquisition of Warner Bros. by Netflix grant the streaming titan an excessive concentration of influence over the global entertainment industry? That is the pivotal question regulators around the world are being asked to contemplate. Netflix maintains that such fears are exaggerated, assuring oversight bodies that its proposed deal would not produce an anticompetitive monopoly. Yet, according to specialists in antitrust law and media economics, the ultimate judgment depends almost entirely on the manner in which Netflix’s competitive universe is defined — that is, who it is seen to be contending with for consumers’ time, money, and attention.
If regulators define Netflix’s market narrowly, limiting it to paid streaming platforms, then the company’s current dominance would appear imposing. Within this walled garden, Netflix towers above rivals like Disney+, Hulu, and Amazon Prime Video, all of which trail its scale and subscription revenue. However, the question becomes more nuanced if one broadens the competitive field to include the traditional television networks and cable channels — the so‑called “TV dinosaurs” once disrupted by Netflix’s very rise. Adding to the complexity are new entrants such as social media–based entertainment services like TikTok, YouTube, and Instagram Reels, which increasingly capture viewers who might otherwise spend evenings watching serialized dramas or feature films. Even the concept of “sleep” has been famously cited by Netflix cofounder Reed Hastings as an unlikely adversary, underscoring how the competition for human attention transcends conventional business categories.
Against this backdrop, Paramount Skydance — a rival bidder for Warner Bros. — has vocally condemned the proposed merger, branding it anticompetitive and potentially disastrous for consumers as well as for talent across Hollywood. Paramount’s leadership contends that Netflix, already the preeminent subscription video‑on‑demand platform, would cement an almost unassailable hold by absorbing Warner Bros.’s extensive intellectual property catalog. This trove would include the cinematic universes of Harry Potter and DC Comics, along with the premium programming legacy of HBO. To Paramount Skydance and others in the industry, such consolidation threatens to diminish creative diversity and could lead to higher subscription prices.
Netflix, however, is attempting to reframe the conversation. The company advocates that regulators evaluate the deal within the broader context of overall U.S. television viewing. In communications to its staff and in public disclosures, Netflix’s executives have expressed confidence that when total viewing hours are considered, the merger would only modestly shift its market position. Based on Nielsen data, Netflix’s co‑CEOs wrote that even after joining forces with Warner Bros., their combined share of television viewership would rise only from 8% to 9%, leaving the platform still trailing YouTube at 13% and a hypothetical Paramount‑Warner Bros. Discovery combination at 14%. A Netflix spokesperson reiterated those statistics when asked for comment, hinting at the company’s strategic emphasis on demonstrating relative modesty rather than dominance.
Nevertheless, persuading regulators may prove arduous. Anthony Palomba, a business scholar at the University of Virginia, noted that agencies such as the Federal Trade Commission (FTC) and the Department of Justice (DOJ) tend to delineate markets narrowly. Historically, they have seen streaming video as distinct from linear television broadcasting, movie theater distribution, or user‑generated video platforms. If that interpretation prevails, the Netflix–Warner Bros. merger would be assessed within a confined competitive space where Netflix already enjoys a commanding presence, thereby amplifying antitrust concerns.
Political dynamics further complicate the case. President Trump has explicitly remarked that the deal “could be a problem,” asserting that Netflix’s market power would expand substantially if it incorporated Warner Bros. Reuben Miller, an authority on antitrust matters at the financial analysis outlet Dealreporter, speculated that the acquisition would almost inevitably face litigation unless Netflix manages to persuade the administration to view its proposal favorably.
From a financial perspective, a fusion of Netflix and Warner Bros. would create a colossus within the subscription streaming landscape. Data from S&P Global Market Intelligence project that the two services together would command 39% of paid streaming revenue in 2025. Historically, U.S. antitrust regulators have scrutinized any enterprise controlling between 30% and 40% of a market, often viewing such concentration as a potential threat to healthy competition. If regulators conclude that paid subscription streamers constitute a discrete market, the proposed merger’s prospects could dim considerably.
Consumers, on the other hand, might not regard social video apps or free ad‑supported platforms as true substitutes for a premium, ad‑free Netflix subscription. As Palomba observes, many households differentiate between sitting down to watch a polished Netflix series and casually browsing user‑generated content on YouTube or TikTok. If this behavioral distinction guides regulatory thinking, the merger could be interpreted as one that consolidates power among paid services, reducing options and possibly enabling price increases.
There are scant precedents for a deal of such magnitude. The Charter Communications expansion in 2016, often cited by analysts, occurred during the infancy of streaming video and under markedly different circumstances. Miller of Dealreporter commented that regulators at that time acted partly to nurture the then‑emerging streaming ecosystem. Today, however, the environment has matured, and streaming dominates consumer viewing habits. As a result, older precedents may offer limited guidance. Miller observed that regulators typically approach mergers under the assumption of potential illegality, obliging the parties to demonstrate otherwise. Thus, Netflix faces the burden of persuading them to adopt a broader definition of competition — one encompassing both paid and free streaming outlets.
Including ad‑supported services such as YouTube, The Roku Channel, and Fox’s Tubi within the competitive equation could significantly strengthen Netflix’s argument. These services, particularly popular among younger viewers like Gen Z, capture vast and growing audiences. Nielsen data reveal that although Netflix remains the most‑watched paid streamer, it has been outpaced on television screens overall by YouTube, whose share of U.S. TV viewership climbed from parity with Netflix at 7.5% in 2022 to nearly 13% by late 2023, while Netflix held around 8%. When analysts factor in such free services, Netflix and HBO Max together accounted for just over 20% of total streaming minutes in the U.S., according to MoffettNathanson’s Robert Fishman. While formidable, that level of presence may not trigger automatic rejection under antitrust norms.
Moreover, in the broader constellation of television as a whole — spanning broadcast and cable networks — Netflix’s relative influence appears less overwhelming. When measured against the total TV market, Netflix ranks as the sixth‑largest media distributor, with an audience share slightly below Paramount’s. Because Netflix is not pursuing the linear cable networks of Warner Bros. Discovery, like CNN or TNT, it can argue that the transaction represents only a partial convergence rather than an all‑encompassing takeover.
Yet opinions within the industry diverge on what truly constitutes competition. Netflix would plainly prefer a definition that encompasses every medium vying for viewers’ attention — from TikTok and Instagram to video games and even digital podcasts. Executives and creatives across Hollywood, however, often reject that all‑inclusive framing. As one television agent bluntly put it, producers are not pitching scripted dramas to YouTube influencers. Corey Martin, an attorney with the Los Angeles firm Granderson Des Rochers, echoed that sentiment, emphasizing that comparing Netflix with platforms like YouTube or TikTok is akin to contrasting entirely different art forms or industries. Audiences turn to Netflix, Disney+, and similar services in pursuit of professionally produced films, scripted series, or live sports events. They do not instinctively equate that experience with scrolling through short clips or playing video games. Rahul Telang, a Carnegie Mellon University professor, similarly notes that although attention is a finite resource shared among these activities, it remains conceptually difficult to claim that a video game competes directly with a motion picture.
Still, some analysts acknowledge the partial truth behind Netflix’s broader thesis. Bernstein’s Laurent Yoon has written that while Netflix leads in the long‑form video category, platforms specializing in short‑form content or sports attract audiences in complementary ways. He further pointed out that digital attention has drifted toward instantly consumable snippets on Instagram and TikTok, even extending to miniature serialized stories known as micro‑dramas. Yoon observed that dismissing these formats as unrelated may echo the same skepticism once directed at streaming itself compared to traditional television a decade ago. Times change, he implied, and so too do the definitions of competition.
Ultimately, regulators now stand at a crossroads. Their decision on how to delineate Netflix’s true market could set a precedent that reverberates through the entire media and entertainment sector for years to come. Whether Netflix is judged as the dominant player in a narrow field of paid video streamers or merely a major contender in the vast and evolving ecosystem of total screen time will determine not just the fate of this proposed merger, but potentially the future contours of global entertainment itself.
Sourse: https://www.businessinsider.com/netflix-warner-bros-antitrust-analysis-paramount-skydance-regulators-social-media-2025-12
