Movie Theaters Take a Stand Against Warner Bros. Sale
Movie theater chains are making a bold move, taking their concerns to Capitol Hill regarding the potential sale of Warner Bros. to Netflix. The largest trade organization representing exhibitors, Cinema United, has expressed deep worries about the acquisition's impact on movie theaters worldwide.
In a written statement to the House Judiciary Subcommittee on the Administrative State, Regulatory Reform, and Antitrust, Cinema United's CEO Michael O'Leary emphasized the potential consequences. He warned that such an acquisition would further concentrate control over motion picture production and distribution in the hands of a single, dominant global streaming platform, exacerbating an already highly concentrated market.
The heated battle between Paramount and Netflix over the Warner Bros. Discovery (WBD) acquisition is not just about price tags and deal terms. Movie theater owners are concerned that Netflix's business model, which does not include theatrical exhibition, could lead to a dramatic reduction in film output from Hollywood and consumer choice at the multiplex. The trade organization's letter to Washington D.C. politicians highlights the potential consolidation of up to 40% of the domestic box office in the hands of a single studio if Paramount or another major studio ends up acquiring Warner Bros.
The exhibition industry faces a grave threat if Netflix or Paramount prevails in the acquisition. Cinema United stated that the acquisition of Warner Bros. by Netflix, a streaming competitor with a vast library of shows and movies, could have an existential impact on movie theaters due to Netflix's hostility toward exhibition. The latest development in this heated contest is the WBD board's rejection of Paramount's revised offer, sticking with the agreement with Netflix, which further intensifies the debate.
