Washington: A US Senate panel has raised serious antitrust concerns over Netflix’s proposed $83-billion acquisition of Warner Bros. Discovery, warning that the deal could significantly reshape competition in the entertainment industry and concentrate excessive market power in a single company.
Speaking at a Congressional hearing on Tuesday, Senate Antitrust Subcommittee Chair Mike Lee described the proposed merger as “extraordinary in both scale and in potential consequence,” saying it demands close regulatory scrutiny.
Lee noted that Netflix, currently the world’s largest streaming platform, would gain control of Warner Bros.’ film and television studios, its streaming services, and a vast catalogue of iconic content. He said the deal presents horizontal antitrust issues, as Netflix and HBO Max directly compete for subscribers seeking premium films and series.
The Utah Republican also highlighted labour market concerns, pointing out that both companies compete for creative talent such as writers, directors, and actors. Consolidating two major employers, he warned, could weaken competition and reduce opportunities in the industry.
In addition, Lee flagged potential vertical risks, saying the merger would combine Netflix’s dominant global distribution platform with Warner Bros.’ content portfolio. This, he suggested, could disadvantage rival studios and streaming platforms. He cautioned that the merged entity might withhold popular titles, increase licensing fees, or prioritise its own content through Netflix’s recommendation algorithms, influencing what viewers see.
Ranking Member Senator Cory Booker echoed those concerns, saying corporate concentration in the media and entertainment sector has reached levels not seen in generations. The New Jersey Democrat warned that the sale of Warner Bros. to a competitor could have “serious consequences for consumers and for the television and film industry.”
Booker said past consolidation in the sector has often led to higher subscription prices, fewer viewing options, and reduced opportunities for artists and creators. He also raised broader cultural concerns, arguing that another major merger could give a single corporation greater influence over “what we see, what we hear and the news we consume,” while creating anxiety among thousands of workers in the industry.
Defending the deal, Netflix co-CEO Ted Sarandos told lawmakers that a combined Netflix and Warner Bros. would strengthen the US entertainment industry and expand opportunities for creators. He said Netflix intends to operate Warner Bros.’ studios largely as they function now, maintain traditional 45-day theatrical release windows for major films, and continue investing in American productions.
Sarandos argued that the media market remains highly competitive, citing broadcast networks, rival streaming platforms, and technology companies. He said Netflix currently accounts for about nine per cent of US television viewing time, a figure he claimed would rise only marginally to around 10 per cent after the merger.
He added that Netflix productions have supported more than 155,000 American jobs and contributed an estimated $225 billion to the US economy.
Warner Bros. Discovery Chief Revenue and Strategy Officer Bruce Campbell told the panel that the company’s board unanimously concluded Netflix’s offer was the best option after reviewing competing bids. He said the vertical merger would pair Warner Bros.’ studios with Netflix’s streaming platform while allowing the planned separation of the company’s news and sports networks into a new entity.
Several senators questioned both executives about possible layoffs, subscription price hikes, and the future of movie theatres. Some lawmakers expressed concern that the deal could shift major film releases away from cinemas toward streaming, potentially harming theatre operators and limiting consumer choice. Sarandos responded that Netflix remains committed to supporting theatrical releases alongside its streaming business.
The hearing comes as the US Department of Justice and the Federal Trade Commission review the proposed transaction under federal antitrust law. Lawmakers from both parties have urged regulators to closely examine the merger’s potential impact on competition, prices, employment, and the future structure of the entertainment industry.