What to know about Netflix’s historic acquisition of Warner Bros.

If you thought 2025 couldn’t get any crazier, the streaming world has one more surprise up its sleeve before the end of the year.

Netflix, the largest streaming platform with over 325 million subscribers, has made a bold move by acquiring Warner Bros. Entertainment. Film and TV studios, plus HBO, HBO Max and other assets. The deal, announced in early December, will bring together some of the most legendary franchises, such as Game of Thrones, Harry Potter, DC Comics and more, all under one roof.

The size of this massive deal has stunned industry observers. Not only is it historic in its scale, it is also poised to change Hollywood as we know it.

We’re here to break down exactly what’s happening regarding the Netflix-WBD deal, including the latest developments, what’s at stake, and what could happen next.

What happened so far?

It all started back in October when Warner Bros. revealed Discovery (WBD) said it was exploring a potential sale after receiving unwanted interest from several major players in the industry.

For many years, WBD has languished under billions of dollars in debt, exacerbated by declining cable viewership and fierce competition from streaming platforms. These financial pressures forced the company to consider major strategic changes, including selling its entertainment assets to a competitor.

The bidding process quickly became competitive. Several major players saw potential in acquiring the media giant. Paramount and Comcast emerged as serious contenders, with Paramount initially seen as the front-runner.

But ultimately, WBD’s board decided that Netflix’s offer was the most attractive, despite Paramount’s offer of roughly $108 billion in cash. Paramount’s bid was intended to acquire the entire company, while Netflix’s bid focused specifically on film, television and streaming assets.

Additionally, Netflix recently amended its agreement to make an all-cash offer at $27.75 per WBD share, reassuring investors and paving the way for the deal to move forward. The value of the deal is approximately $82.7 billion.

Fierce bidding war

Even after Netflix emerged as the preferred buyer, tensions with Paramount remained high, as the rival company continued to pursue Warner Bros. Origins.

Paramount continued its attempts to acquire WBD for several months. However, the board repeatedly rejected his offers, citing concerns about Paramount’s heavy debt load and the increased risks associated with its proposal. The board noted that Paramount’s offer would have left the combined company with $87 billion in debt, a risk the company was not willing to take.

In January, Paramount filed a lawsuit seeking more information about the Netflix deal. A month later, the company sought to sweeten its deal by announcing that it would offer a “recording fee” of $0.25 per share to WBD shareholders for each quarter the deal failed to close by December 31, 2026. It also said it would pay a $2.8 billion breakup fee if Netflix backed out.

The company continues to emphasize that its offer is much better.

Regulatory obstacles

Given the unprecedented size of the deal and its market impact, regulatory scrutiny is intense and remains a significant obstacle to closing the deal. Earlier this week, it was reported that Netflix co-CEO Ted Sarandos is set to testify before a US Senate committee about the deal, a move that highlights how seriously lawmakers are taking these concerns.

In November, prominent lawmakers – Senators Elizabeth Warren, Bernie Sanders, and Richard Blumenthal – expressed their concerns to the Justice Department’s antitrust division, warning that such a massive merger could have dire consequences for consumers and the industry at large. The senators argue that the merger could give the new media giant excessive market power, enabling it to raise prices for consumers and stifle competition.

If regulators block the acquisition, Netflix will be obligated to pay a breakup fee of $5.8 billion. It remains unclear whether Warner Bros. Will it remain an independent company or will it reconsider previous takeover proposals?

Concerns within the industry

Reaction from the entertainment industry was largely negative. The Writers Guild of America was among the most vocal critics, calling for a ban on the merger on antitrust grounds.

Additionally, insiders worry that the acquisition will push independent creators and diverse voices out of the spotlight, ultimately narrowing the range of stories being told. There are also widespread concerns about potential job losses and lower wages.

For creators and theaters, there is still uncertainty about release windows. Netflix co-CEO Ted Sarandos has said that all films planned for theatrical release through Warner Bros. It will continue as scheduled. However, he also hinted that over time, release times may be shortened, with films arriving on streaming platforms sooner than before.

What should subscribers know?

What does all this mean if you’re a Netflix or HBO Max subscriber?

Netflix executives reassured viewers that HBO’s operations will remain largely unchanged in the near term. At this point, the company says it’s too early to make any final announcements about potential bundles or app integrations.

Regarding pricing, Sarandos stated that there will be no immediate changes during the regulatory approval period. However, subscribers should be aware that Netflix has historically raised subscription prices regularly, so price increases are possible once the acquisition is finalized. Netflix tends to raise its prices every year or two.

When is the deal expected to close?

The Netflix-WBD deal is not final yet.

A WBD shareholder vote is expected to take place around April, and the transaction is expected to close 12 to 18 months after that vote. However, regulatory approvals are still pending, and an audit could shape the final outcome.

Stay tuned…