Analysts Discuss the Challenges of Netflix’s Major Deal with Warner Bros. Discovery
Analysts around the globe are closely scrutinizing the implications of Netflix’s recent acquisition of Warner Bros. Discovery (WBD), a deal announced earlier today with an enterprise value of $82.7 billion. The acquisition includes the Hollywood studio responsible for popular productions such as Succession and the Harry Potter franchise.
François Godard, Media and Telecoms Analyst at Enders Analysis, raised concerns about the merger’s potential impact. “My first reaction is, watch out, Netflix,” he remarked. “The merger of Warner Bros. and Discovery destroyed value, and the risk is that this new deal will also produce a result smaller than the addition of the parts. HBO, the most brilliant TV creative house survived Zaslav, but will it die under Netflix?”
In contrast, Guy Bisson, Executive Director of Ampere Analysis, viewed the acquisition as significant but not surprising. “It was clear to me from what Ted Sarandos said at the last quarterly results that WBD was a priority target for Netflix,” Bisson stated. He noted that Netflix’s evolution toward a vertically integrated studio aligns with this acquisition, which would provide a suite of intellectual property that would take decades to develop independently. He emphasized, “It won’t have gone unnoticed that HBO content performs extremely well on Netflix.”
Strategic Complications
Jack Davison, Executive Vice President at 3Vision, highlighted numerous strategic challenges this acquisition could entail. He pointed out that Netflix has largely avoided theatrical distribution, while Warner Bros. remains heavily reliant on it. Questions loom over existing agreements between TV distributors and film sellers with Netflix and HBO Max. “This opens up loads of questions about how Netflix works with the IP and catalog they acquire,” Davison said, contemplating Netflix’s future theatrical strategy and third-party collaborations.
Despite the uncertainties, Netflix confirmed its intention to “maintain Warner Bros.’ current operations” in its official announcement.
Bisson speculated that HBO Max might be of interest to another industry player, Comcast, as it would provide the company with a more substantial global streaming presence. “I wouldn’t be surprised if Comcast lined up to take that on,” he noted.
The acquisition comes on the heels of HBO Max’s global rollout, with recent announcements regarding the service’s expansion into key European markets, including Germany, Italy, and the UK, set for 2026. Additionally, updates about new programming and the much-anticipated second trailer for the Game of Thrones prequel, A Knight of the Seven Kingdoms, have generated excitement.
Nonetheless, questions remain about whether Netflix could coexist with HBO Max should the acquisition proceed. Together, the two entities would command a subscriber base of approximately 450 million, raising potential antitrust concerns.
Godard underscored that HBO Max, poised to launch in the UK, Germany, and Italy, may face a premature closure should Netflix’s acquisition proceed. He also indicated that other WBD assets could face uncertain prospects in the future.
Netflix’s acquisition is slated to finalize following the spinoff of WBD’s channels business, Discovery Global, now anticipated by Q3 2026. “Linear channels are out of the deal,” Godard clarified, noting that outlets like TNT in the UK and Eurosport elsewhere in Europe would remain in the legacy corporate structure post-sale. “I don’t think that alone, without the backing of a streamer, TNT and Eurosport have a sustainable future,” he added.
Godard also speculated that Paramount could be interested in acquiring TNT, a move contingent on buying out BT, which holds a 50% stake and renegotiating distribution with Sky.
Furthermore, the linear Discovery assets in Europe might attract interest from existing broadcasters, with Discovery Italy—its largest operation in the region—potentially appealing to Comcast-owned Sky Italia.
