With Netflix's proposed acquisition of Warner Bros., old fears have come back to life: consolidation threatens competition, monopoly looms, and only aggressive antitrust enforcement can save consumers. It's the same narrative we heard when AT&T purchased Time Warner in 2018—a deal that critics insisted would harm the market. Within a few years, the market self-corrected, and AT&T divested the assets at a loss. The supposed crisis never materialized.
Senator Elizabeth Warren calls the Netflix deal "an anti-monopoly nightmare," while Republican Senator Mike Lee says it raises more serious competition questions "than any transaction I've seen in about a decade." Their bipartisan opposition rests on a fundamental error: they're measuring the wrong market.
Critics claim Netflix will control half of all streaming. But the relevant market isn't "streaming services"—it's entertainment and attention. YouTube, TikTok, gaming, and sports all compete for the same hours in the day. Even combined, the merged company would represent just 13.6% of total U.S. TV viewing time, per Nielsen's October 2025 data—hardly a monopoly in a market where YouTube alone commands 13%. What regulators consistently overlook is what they cannot see or predict. Markets and competition are constantly shifting. If a firm becomes too greedy, it invites swift competitive entry—provided government doesn't block it. The greatest threat to competition isn't corporate size; it's regulation that protects legacy companies from disruption.
The burden of proof lies with critics to demonstrate actual rights violations—not with bureaucrats to speculate about hypothetical harms they cannot see. The Netflix-Warner Bros. deal is nothing more than a voluntary exchange between private parties using private capital. Harmful monopolies do not emerge from voluntary transactions; they arise from state privilege—exclusive franchises, coercive barriers, and IP overreach. Size alone, achieved through productively serving customers, is not evidence of monopoly power. As we learned from the Progressive Era's assault on railroads, antitrust law too often punishes success: competitive pricing, consumer-friendly bundles, and efficient vertical integration.
Regulators and pundits rolled out the same playbook against Microsoft's buyout of Activision Blizzard. The FTC fought the deal for two years, warning of monopoly power in gaming. Critics predicted Microsoft would weaponize exclusive content, crush Sony, and hurt consumers through less choice and higher prices.
None of it happened. The FTC's credibility took a beating.
Every major merger triggers the same fears: higher costs, less choice, concentrated power. The greatest myth underlying these objections is that large companies can keep competition out through sheer size. But this only happens when government protects businesses through exclusive franchises and regulatory barriers—not when companies grow by serving customers in a free market.
Government does create monopolies.
Let's look at the railroads. Before federal regulation, railroad companies repeatedly attempted to form cartels through price-fixing agreements. Every attempt failed. Companies would quietly slash prices to compete, or new routes would undercut existing routes and steal their business. Shippers received rebates and favorable rates. Critics decried this as "discriminatory," but it was simply the free market creating efficiency through competition.
Then came the Interstate Commerce Commission. Washington promised to protect consumers by policing the industry. Instead, the government set prices, approved mergers, and controlled competition. By the early 1900s, the ICC had given railroads the oligopoly power they could never achieve themselves, protecting incumbents from upstart competitors. The regulation designed to protect consumers created the exact market power railroad giants had failed to secure through voluntary means.
The loudest anti-merger voices reveal their true motives through their affiliations. They're connected to direct competitors and interest groups protecting their own businesses—not protection for consumers. Genuine monopolies have always shared one trait: legal privilege and government protection. Political favoritism picks winners and losers, inevitably accompanied by regulatory capture.
This isn't a call to ignore mergers entirely or let companies operate without accountability. Some scrutiny is necessary—but it must be legitimate. Regulators should verify that no clear rights violations exist and that state-granted privileges aren't part of the equation. If these major red flags are absent, there's no problem for antitrust law to fix.
The real harm comes from the process itself. An 18-month regulatory review doesn't just delay this transaction—it creates a template for political favoritism in future deals. When antitrust enforcement becomes unpredictable, driven more by which executives have the president's ear than by consistent legal standards, capital flows toward regulatory arbitrage instead of productive investment. Netflix's $5.8 billion breakup fee isn't just a transaction cost; it's a signal that merger decisions increasingly depend on political favor rather than market merit.
Regulators should stop pretending these interventions protect consumers and let the deal proceed. Entrepreneurs and consumers—not lawyers, bureaucrats, and pundits—should decide what succeeds in the market. We'll determine whether this merger serves our interests. That's how markets work.
