Netflix Faces DOJ Antitrust Probe Over $82.7B Warner Bros. Acquisition
Justice Department is probing Netflix’s proposed $82.7 billion acquisition of Warner Bros. Discovery assets, issuing a civil subpoena over potential exclusionary conduct. Combined Netflix and HBO Max would command roughly 30% of the U.S. subscription streaming market, raising heightened antitrust risk.
1. DOJ Antitrust Investigation
The U.S. Justice Department has launched an antitrust investigation into Netflix’s proposed acquisition of Warner Bros. Discovery studios and its HBO Max streaming service. A civil subpoena issued to an entertainment company seeks information on whether Netflix engaged in exclusionary conduct to bolster monopoly power.
2. Terms of Acquisition and Rival Bid
Netflix agreed to buy Warner Bros. Discovery assets at $27.75 per share, valuing the equity at about $72 billion and total enterprise value at roughly $82.7 billion. Paramount Skydance countered with a hostile $77.9 billion bid for Warner Bros. Discovery, prompting regulators to assess both transactions.
3. Market Share Implications
Estimates show a combined Netflix and HBO Max would control approximately 30% of the U.S. paid streaming market, a figure likely to trigger intensified regulatory scrutiny under DOJ guidelines. Netflix contends that about 80% of HBO Max subscribers already subscribe to its service and competes broadly with free platforms like YouTube.
4. Netflix’s Response and Market Reaction
Netflix’s counsel denies any separate monopolization investigation and notes no formal notice of wrongdoing. On news of the probe, shares rose 1.64% to close at $82.20, then edged to $82.06 in after-hours trading, though the stock’s short- and long-term momentum scores remain weak.