Close your eyes, think for a minute, and tell me: What is a Netflix Movie? OK, try again: What is a Netflix Show?
Sure, it’s easy to rattle off some killer titles—KPop Demon Hunters, Stranger Things—but Netflix has never really had a brand identity. It’s not, like Disney, the home of Star Wars and Mickey Mouse. As streaming services go, it’s made its name by being a jack of all trades and a master of none. Now, it’s made its smartest move yet, dropping $83 billion to buy itself a whole new personality.
On Friday, the streaming giant announced it will be acquiring Warner Bros. in a deal that gives Netflix the studio’s film and television operations as well as HBO and HBO Max. For those who can’t keep up with who owns what these days—no one can—that means that once the deal closes, Netflix will own everything from Batman to The Big Bang Theory, The Wizard of Oz to Westeros. Also, Lord of the Rings, Harry Potter, and prestige TV shows like The Sopranos.
The deal, which is expected to close next fall after Warner Bros. Discovery spins off its cable business (CNN, HGTV, Discovery, and others), surprised the hell out of Hollywood when Netflix announced it Friday morning. Warner Bros. Discovery’s future had been hanging in the balance for weeks, with a series of potential buyers putting in offers. NBCUniversal parent company Comcast made a bid. So did Paramount Skydance, which worried some given that the merger of Paramount and Skydance, headed up by Oracle founder Larry Ellison’s son David Ellison, became a political football involving everything from South Park to The Late Show with Stephen Colbert, which got put on ice this summer.
Ultimately, Netflix won, making itself the place where viewers will go for Game of Thrones rewatches and whatever new thing James Gunn does with the DC Extended Universe. In effect, it gives the streaming giant an identity it didn’t have before and a back catalog that will rival that of Disney+. It could also transform the streaming giant into something far more akin to a traditional movie and TV studio—if that’s what it wants to be.
That’s the big question. As soon as the acquisition was announced, industry observers began to speculate whether or not Netflix would, say, continue Warner Bros’ commitment to theatrical releases, something that’s important to its auteur directors like Dune filmmaker Denis Villeneuve. Some also wondered, given Netflix co-CEO Ted Sarandos’ recent comments about embracing generative artificial intelligence, if it would lead to more AI content generated thanks to Warner Bros. massive library. All scenarios seem possible, but also at odds with each other. Today’s deal means Netflix has a decision to make: Use the Warner Bros. legacy it has acquired to carry on as a major Hollywood studio, or use it to make reams of content but far less art.
In Hollywood, labor groups are already worried about the deal. Despite Sarandos’ claims that the deal would be “pro-worker,” several unions released statements claiming the acquisition would lead to fewer jobs, lower wages, and diminish the diversity of content available to audiences. Parks and Recreation creator Mike Schur, a board member of the Writers Guild of America West, noted on Bluesky “all media mergers end up hurting writers, actors, directors, and everyone else who works in the industry. Fewer companies means fewer jobs, period.”
In many ways, Netflix’s acquisition is the end of the era that has been the streaming wars. For nearly a decade, the company has been jockeying for position as new players like Amazon Prime, Apple TV, and others entered the fray. Things got even hairier once the traditional studios started launching their own Paramount+’s and Disney+’s and buying each other up. Eventually, things (d)evolved into a landgrab that led to Disney acquiring 21st Century Fox, Amazon acquiring MGM for $8 billion, and the merging of Warner Bros. and Discovery, the latter two of which look very different now that Netflix is laying out $82.7 billion for one of the most storied studios in Hollywood. (Also, called it.)
In a call with analysts on Friday morning, Sarandos acknowledged that many of them may be “surprised” by the acquisition since, as he put it, “we have been known to be builders, not buyers.” It seemed like a nod to the fact that, even as it has licensed scores of IP over the years to fill its library, it’s never been a part of the M&A-as-R&D Hollywood crowd. Provided its Warner Bros. deal goes through—and Netflix has agreed to pay a $5.8 billion termination fee if it doesn’t—it will make Netflix an even bigger juggernaut than it is, the biggest of the new Big Three.
It will also make Netflix—and Hollywood—look nothing like what it did before.
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