An HBO Max subscriber from Las Vegas has filed a class action complaint against Netflix in an attempt to block its Warner Bros. Discovery merger due to antitrust concerns and the potential of increased pricing.
A Las Vegas woman called the acquisition “presumptively anticompetitive” in her documents, filed on Monday and obtained by TheWrap. Her legal team also wrote that the deal could lead to steeper prices, citing Disney+ and Hulu as an example.
“In the past few years, after the SVOD Market emerged post-pandemic with a handful of dominant products — Netflix, Amazon Prime, HBO Max, Disney+, Hulu and Paramount Plus — market prices have begun to soar, with service quality and output stagnant or degraded,” the 56-page lawsuit states. “All this while SVOD subscription prices — including for Netflix and for HBO Max — have soared far beyond inflation in recent years and more than doubled in less than a decade.”
It continues, “This market-wide price increase coincides with the recent merger, and ongoing consolidation, of two market-leading SVOD services, Hulu and Disney+, under common ownership, control, and branding. The elimination of a leading SVOD competitor by Disney raised prices, reduced quality, and has not been offset by competitive entry due to the [Content and Subscriber Barrier to Entry].”
“The Netflix-WBD merger would greatly strengthen the CSBE surrounding the U.S. SVOD Market, and at the same time would massively increase concentration in an already calcified and oligopolistic market — a market that has responded to past consolidation with aggressive market-wide price hikes and quality degradation,” it further notes. “The proposed merger would increase the Herfindahl-Hirschman index in the U.S. SVOD market by more than 500 points, from an already moderately concentrated baseline — a massive increase that is presumptively anticompetitive under Department of Justice Horizontal Merger Guidelines.”
The class action lawsuit comes less than a week after Netflix and WBD entered exclusive talks for the streamer to purchase the legacy brand’s studio and streaming assets for $27.75 per share, a mix of cash and stock worth $82.7 billion. However, Paramount has since muddied the waters with a hostile takeover bid of $30 per share, an enterprise value of roughly $108.4 billion.
The post Netflix-WBD Merger Faces Antitrust Class Action on Behalf of HBO Max Subscribers: ‘Presumptively Anticompetitive’ appeared first on TheWrap.
