A Netflix-Warner Bros. merger would risk a monopsony where a single buyer wields enormous control over the marketplace, the former head of Amazon Studios warned.
Roy Price, who is now chief executive of the studio International Art Machine, wrote in a New York Times op-ed on Saturday that predictions of doom are nothing new in the film industry, pointing to the advent of TV, home video, streaming, and AI.
“But if Netflix acquires Warner Bros., this long-prophesied death may finally arrive, not in the sense that filmmaking will cease but in the sense that Hollywood will become a system that circles a single sun, materially changing its cultural output,” he added. “All orbits—every deal, every creative decision, every creative career—will increasingly revolve around the gravitational mass and imprimatur of one entity.”
To be sure, Netflix has said Warner Bros. operations will continue, and the studio’s films will still be released in theaters. Meanwhile, Warner’s TV channels will be spun off via a separate company, though HBO will be included in Netflix.
But Price said the danger “is not annihilation but centralization,” with the combined company accounting for an even bigger slice of overall content spending.
A reduction in bidders also means less content will be produced, while a separate development culture, set of tastes, and risk tolerances will be sidelined, he predicted.
“A Netflix merger with Warner Bros. would create a monopsony problem: too few buyers with too much bargaining power,” Price explained. “Writers, directors, actors, showrunners, puppeteers, visual effects artists—all are suppliers. The fewer buyers competing to hire them, the lower their compensation and the narrower their opportunities.”
Such reasoning sank Penguin Random House’s attempt to merge with Simon & Schuster that would’ve created a book publisher with too much leverage over authors, he pointed out.
Of course, the remaining players in Hollywood and content creation are giants in their own right as well. A KPMG survey of spending in 2024 put NBC Universal parent Comcast at the top with $37 billion, followed by Alphabet’s YouTube ($32 billion), Disney ($28 billion), Amazon ($20 billion), Netflix ($17 billion) and Paramount ($15 billion). Comcast and Paramount also made bids for Warner Bros.
Theater owners, producers and other creative workers have also voiced opposition to the deal, though famed director Bong Joon Ho doubted that the “cinematic experience will disappear so easily.”
In addition to the business impact of a Warner Bros. takeover, other opponents raised even weightier concerns.
Oscar winner Jane Fonda sounded the alarm on a “constitutional crisis” and demanded that the Justice Department not use its regulatory power to “extract political concessions that influence content decisions or chill free speech.”
For its part, the Trump administration views the deal with “heavy skepticism,” sources told CNBC. The merger is expected to face exceptional antitrust scrutiny, and Netflix’s $5.8 billion breakup fee is among the biggest ever.
On Wall Street, analysts see a tech angle in the merger, namely the importance of content to train and power the next generation of AI models that will shape the entertainment industry’s future.
The acquisition of Warner Bros. would help Netflix stand out in an AI future, Divyaunsh Divatia, research analyst at Janus Henderson Investors, said in a note on Friday.
“They’re also levering up on premium entertainment at a time when competition on engagement from short form video is expected to intensify especially if AI models democratize video creation at an increasing rate,” he wrote.