Whether or not Netflix’s $82.6 billion acquisition of Warner Bros. goes through, the deal encapsulates a fraught moment for Hollywood, as the entertainment business is increasingly overshadowed by tech giants.
On the latest episode of the Equity podcast, Kirsten Korosec and I discussed the deal’s implications, both for Netflix and the larger Hollywood ecosystem. Kirsten noted that it’s just the latest move bringing more consolidation to the media business, and she wondered whether it’s “too big a risk” for Netflix.
Meanwhile, I discussed a call with Netflix executives where Wall Street analysts also seemed to be struggling to wrap their heads around the deal. And then of course there’s Paramount’s competing hostile bid — whatever happens, Warner Bros.’ days as a standalone company seem to be numbered.
You can read an edited preview of our conversation below.
Kirsten: I remember when Netflix was just a little baby startup and I got their [DVDs] in the mail. Here they are, all grown up, bidding for a legacy company. Did that run through your head when you saw the news?
Anthony: Certainly symbolically, it’s this moment where the upstart has eaten Hollywood. There’ve been all these articles, even before this deal, saying, “Netflix is eating Hollywood, Netflix is transforming Hollywood.” Regardless of whether or not this deal ends up going through, Netflix will have transformed Hollywood, but this seems like the biggest — both symbolically but also substantively — one of the most dramatic things that can happen.
Then there are all these other questions about: Will Netflix get regulatory approval? Will Paramount’s hostile bid succeed?
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What jumped out to you is you were catching up on it, Kirsten?
Kirsten: Well, the first thing was I was like, can there be any more consolidation in this market? I mean, tha …