Netflix co-CEO Ted Sarandos is set to testify before a Senate subcommittee on February 3 about the company's $83 billion plan to acquire Warner Bros.' studio and streaming assets, a deal facing intense antitrust scrutiny from lawmakers.
Washington's red flags: The proposed merger has drawn sharp criticism from key lawmakers. The antitrust panel's ranking Republican, Senator Mike Lee (R-UT), is a vocal opponent, warning the plan has "a lot of antitrust red flags." Similarly, Senator Elizabeth Warren (D-MA) blasted the proposed tie-up as an "anti-monopoly nightmare," warning it would ultimately harm consumers.
A killer theory: The scrutiny goes beyond typical market consolidation fears. In a letter first obtained by The Capitol Forum, Senator Lee raised the possibility that the pact could be a "killer non-acquisition"—a tactic where a company uses the lengthy regulatory review of a proposed merger to weaken a competitor with no real intention of closing. The Department of Justice, which has already issued a second request for information, is reviewing the deal alongside the Federal Trade Commission.
The counter-pitch: Netflix is pushing back against the monopoly narrative, contending it still accounts for less than 10% of total TV viewing time in major markets. Sarandos is pitching the deal as a boon for Hollywood, promising it will grow Netflix's production capabilities and lead to more jobs. The political showdown is complicated by a hostile takeover bid for Warner Bros. Discovery from rival Paramount, adding another twist to the high-stakes showdown.
The hearing will set the tone for a regulatory battle that could redefine the entertainment industry, signaling how much consolidation Washington is willing to tolerate in the streaming era. The Warner Bros. deal is just one piece of Netflix's larger strategy, which includes a recent global streaming pact with Sony Pictures. The regulatory fight is also going global, as both Netflix and Paramount are reportedly meeting with European regulators.
