Netflix CEOs advocate for Warner Bros. Discovery merger in internal memo

Netflix’s co-CEOs, Ted Sarandos and Greg Peters, recently penned a letter to their employees, making a strong case for the company’s acquisition of Warner Bros. Discovery. They aimed to reassure those in the entertainment industry, particularly amid a competing bid from Paramount Skydance.

Sarandos and Peters addressed concerns about potential job cuts and the future of theatrical releases, emphasizing that once the deal is finalized, Netflix will be entering the theatrical business. They acknowledged that in the past, Netflix had not prioritized theatrical releases but assured employees that the landscape would change post-merger.

One key point the CEOs emphasized was the commitment to avoiding studio closures and job redundancies, focusing instead on growth and support for Hollywood’s iconic studios and the preservation of film and TV production opportunities.

Netflix’s $72 billion deal includes assets like HBO, HBO Max, and Warner Bros Studios, with Paramount Skydance offering a higher bid of $78 billion for the entire Warner Bros Discovery. Despite the competitive bid, Netflix remains confident in its acquisition deal, believing it offers substantial long-term value to shareholders.

In addressing concerns about regulatory approval and antitrust issues surrounding the deal, the CEOs referenced Nielsen viewership data to underline that a Netflix-Warner Bros merger would result in a smaller market share compared to other potential combinations like Paramount and Warner Bros.

If the merger goes through, Netflix will take over one of Hollywood’s most historic studios, known for classics like “Casablanca” and blockbuster franchises like “Harry Potter” and “Lord of the Rings.” The acquisition would also give Netflix control over HBO, a pillar of television success with acclaimed shows like “The Sopranos” and “Game of Thrones.”

Overall, Netflix sees the merger as an opportunity for growth, industry support, and the continuation of Hollywood’s legacy in film and TV production.