Netflix co-CEO Ted Sarandos testified on Capitol Hill this week where he defended his company’s $83 billion merger deal with Warner Bros. as a means to compete with “deep-pocketed tech companies” out to run the entertainment business.
In his opening remarks, Sarandos said that the Netflix-Warner Bros. deal “will strengthen the American entertainment industry, preserve choice and value for consumers, and give creators more opportunities,” asserting that the company created 155,000 jobs across all 50 states while contributing “over $225 billion to the U.S. economy over the last 10 years,” per Variety.
Sarandos also said that Netflix would respect Warner Bros. integrity and allow the studio to operate “largely as they are today,” adding that the studio has assets Netflix does not have. By combining both the Netflix library and the HBO Max library, Sarandos said that the company would be offering customers more for less, claiming that 80 percent of HBO Max subscribers currently subscribe to Netflix.
“He also said Netflix faces increasing competition from ‘deep-pocketed tech companies trying to run away with the TV business,’ naming Google’s YouTube, Apple and Amazon’s Prime Video,” continued Variety. “He noted that Netflix’s share of U.S. TV viewership for December was 9% and that with HBO Max will be around 10%, still behind YouTube’s share of TV viewing.”
“Among premium streaming services, according to Sarandos, Netflix has about 18% share in the U.S. while HBO Max has about 3%, meaning the combination would hold about 21%,” it added.
While President Donald Trump has hinted at opposition to the merger, he has said that he will let it play out in the courts and in Congress.
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