Netflix Enters The Mix to Buy Warner Bros.

Just when you thought the Hollywood consolidation was maybe over, we hit a new round of awful.

We reported that, fresh off his blockbuster takeover of Paramount last month, Skydance's David Ellison is apparently just getting started. He wants Warner Bros Discovery, and HBO, CNN, Batman, and Barbie to come with it.

But of course, he's not the only one.

Netflix is also rumored to have stepped in to look at buying Warner. It has an insanely valuable library and ancillary components, one that the streamer would love to get its hands on.

But is any of this fiscally reasonable?

Let's dive in.

Buying Warner Bros Is Not Going to Be Cheap

Warner Bros. Discovery is drowning in over $35 billion in debt against a $41 billion valuation. Its CEO, David Zaslav, is in the middle of an aggressive plan to reorganize the company and find profitability.

For Warner to sell now, the entire board would have to push aside the Zaslav strategy it agreed on and see greener pastures in selling the company.

Adding to the complications is that the stock for Warner is going up under speculation of a sale.

It would take a hefty cash offer to see WB absorbed, but the two richest places in town right now are Paramount, Skydance, and Netflix. And each of them has deep enough pockets and profitability to make a splash.

Netflix Wants Everything

Netflix is very powerful and very influential. Still, it doesn't have the prestige of a studio like Warner, which has been around for over 100 years. Taking over a place like that would be a feather in the cap and give them a history money cannot buy.

Last week, we saw Netflix co-CEO Ted Sarandos sitting ringside with David Zaslav at the recent Crawford–Álvarez fight in Las Vegas. On its own, it’s just two execs enjoying a night out. In this context, it feels like the two guys are possibly talking about a takeover.

If a Netflix takeover were to happen, it would cost the industry more jobs, take another buyer off the table, and hurt theatrical distribution.

The Slow Erosion of Cinema

Let's be brutally honest. Netflix does not care about the theatrical experience. Its goal isn't to create cinematic events; it's to acquire and retain subscribers.

That means debuting big movies in your house and not at your cinemaplex.

If Netflix were to absorb Warner Bros., it wouldn't use it as a robust theatrical distribution arm. It would use its legendary library and IP, and I'd worry about what would happen to all the classic films it houses. Would it be available on Netflix, or would it not be available to watch anywhere?

Let's not dive too deep into all the executives, assistants, and departments it might erase due to overlap. This would really hurt the potential expansion of Hollywood altogether.

Fewer places to bring ideas would have deep ramifications for writers and directors as well.

Summing It Up

We are still a long, long way from this nightmare becoming a reality. But the fact that this rumor even exists is a terrifying sign of the times.

Let me know what you think in the comments.