While Warner Bros. and Paramount were occupied with a new round of acquisition talks, Netflix’s Co-CEO Ted Sarandos went on a high-profile tour of major media outlets to make the case for his company’s offer to take over WBD. Sarandos was front and center with his interviews at CNBC, The Town, and Bloomberg. Sarandos responded to tough questions about whether the combination of Netflix and WBD would constitute a monopoly, if Netflix is truly committed to releasing Warner’s new movies to theatres for an exclusive initial period, and what their rationale is to acquire WBD in the first place. Sarandos refuted the arguments of the naysayers, and made the case that a Netflix takeover of Warner Bros. would benefit the entertainment industry overall, rather than hurt it.
One of the industry’s biggest concerns about Netflix is whether they would continue to support exclusive theatrical windows for Warner Bros.’ movies. In an interview this week with Matt Belloni on ‘The Town’ podcast, Sarandos stated that “nothing will change” with the current theatrical model at Warner Bros. In a Bloomberg interview, Sarandos went so far as to argue that Netflix’s acquisition would be “better for theaters” because some titles from the current Netflix movie studio would use Warner Bros.’ existing distribution network, in contrast to a Paramount takeover, which would result in consolidating the two distribution arms.
He has been non-committal on following Warner Bros. current approach to Premium Video on Demand (PVOD), in which Warner Bros. films only become available on HBO Max after 45 days of availability to rent at home through PVOD services.
Despite Sarandos’ efforts, some industry players remain unconvinced. Cinemark CEO Sean Gamble said he does not “place too much stock” in Netflix’s new commitments, given how radically different they are to previous statement from the company that moviegoing is an “outmoded” way to see movies. Even the government is skeptical, with reporting that the Justice Department has begun investigating the effect that a Netflix takeover of WBD would have on movie theatres. While some have asked Sarandos to make a written commitment to theatrical releasing, the CEO has resisted doing so in order to avoid “a bizarre competitive disadvantage down the road.”
