The Man of Steel may soon have a new home. Netflix, which began as a DVD-by-mail rental service and is now the world’s leading streaming site, is seeking to acquire Warner Brothers studios. The merger will give Netflix access to Warner Brother’s film library and other properties—including DC Comics. This will enable Netflix to expand its offerings to include classic movies like Casablanca, Blazing Saddles, and The Exorcist—as well as franchises like Harry Potter and the Lord of the Rings (and did I mention Superman?)
The deal would thus enable Netflix to not just to expand its existing catalog, but to produce new content for both streaming and theatrical releases. However, the merger is far from a done deal. Paramount studios has launched a hostile takeover bid for Warner Brothers, while critics from both the left and the right are attacking the merger. Even President Trump has expressed concerns about the deal and said he will personally be involved in the approval process.
Critics of the deal say that by acquiring one of the major film studios, Netflix will gain a monopoly over streaming and could dominate the entire entertainment industry. However, the streaming market is extremely competitive, with most major studios, as well as leading internet platforms like Amazon, offering streaming services. Netflix is not the first streamer to try to gain a competitive edge by acquiring a major studio. For example, shortly before launching Disney Plus, the “house of mouse” bought Fox Studios to add more content to its streaming service. Amazon followed suit by buying MGM. Such acquisitions can introduce Hollywood classics to new generations and breathe new life into beloved properties. For example, Amazon will be producing new James Bond films.
Netflix, Amazon, Disney, and other streaming services do not just compete with each other, but also with social media platforms such as YouTube and Facebook. YouTube actually has more viewers than Netflix and offers free movies in addition to movie clips, movie commentary, and other originally produced content. YouTube, TikTok, Instagram, Facebook and other sites make creating and sharing original content super easy, barely an inconvenience. In fact, some YouTube stars make more money and are more popular than Hollywood actors!
Those concerned about the effect of Netflix buying Warner Brothers should consider that if Paramount acquires Warner Brothers the result would be a studio that may be even bigger and more powerful than a Netflix-Warner Brothers combination. Some have expressed concerns that Netflix’s acquisition of Warner Brothers will be the nail in the coffin for movie theaters. However, Netflix co-CEOs Greg Peters and Ted Sarandos have committed to maintaining theatrical releases—albeit with a shorter “window” before the movie is available online. More importantly, streaming is likely to continue to grow in popularity while movie theater attendance declines regardless of whether or not Netflix buys Warner Brothers.
This is not just because Netflix costs $17.99 per month for unlimited movies whereas the average cost of one movie ticket is $11.99. It is also because streaming is obviously more convenient than driving to a theater—and it is cheaper to pop a bag of microwave popcorn than buy overpriced movie snacks. From a strictly economic perspective streaming is a much better deal. Streaming also means you can pause the movie when you or a family member or friend need to use the bathroom or get more snacks. Streaming also allows you to watch a movie without being disturbed by the conversation of the couple siting next to you, the cell phone junkie behind you, and the ongoing commentary of the wannabe movie critic in front of you. Some have expressed concerns that the decline of movie theaters deprives Americans of a communal experience. However, with streaming, viewers can share their opinions of a film with other interested parties on social media either while watching it or later.
There are hundreds of Facebook pages, Reddit threads, and other sites devoted to discussing movies. These create a more meaningful common experience than sitting (hopefully) quietly in a dark room with strangers you will never actually interact with. Netflix’s purchase of Warner Brothers should be approved because it will allow companies to expand their offerings for both the theatrical market and streaming. It also spurs other leading streaming providers to improve their offerings and encourages more studios to integrate streaming with their theatrical releases. The merger will thus benefit all Americans—no matter their preferred way of watching movies.
