Netflix co-CEO Ted Sarandos pushed back against antitrust concerns and denied allegations of wokeism in an occasionally testy Congressional hearing into the streamer’s proposed $82.7bn acquisition of Warner Bros’ streaming and studios business on Tuesday (February 3).
Testifying in front of Republican and Democratic senators in Washington DC., Sarandos reiterated that the streamer would preserve the 45-day exclusive theatrical window should the merger go through. He touted the company’s job-creation record in the US, and its plans to continue making film and series in the country.
Sarandos said Netflix productions have created more than 155,000 American jobs, contributed $225bn to US economy, and filmed in all 50 states, adding that the company was currently investing $1bn to transform a former military base in New Jersey into a production facility.
Asked by Republican Senator Ted Cruz (Texas) of the sub-committee on antitrust, competition policy, and consumer rights if he thought monopolies were a good thing, the Netflix co-CEO was clear. “No sir they are not,” he said. ”We are nowhere near a monopoly. We are 9% [of total US television] viewership and would rise to 10% [were the Warner Bros deal to go through].”
When Cruz pressed WBD chief revenue and strategy officer Bruce Campbell, who also testified on Tuesday, on the implications of a combined subscriber base of more than 100m – Netflix commands approximately 86m members in the US, and HBO Max approximately 50m – the WBD executive noted an overlap of roughly 80% of HBO Max members also subscribed to Netflix.
Sarandos continued, “We’re buying a company that has assets that we do not, and we will keep investing in Warner Bros. We will preserve one of the five majors studios in Hollywood. We will support theatres by releasing those movies with traditional 45-day windows and we will keep growing the American entertainment industry.”
The Netflix co-CEO cited YouTube as one of several “deep-pocketed tech companies who are trying to run away with the television business”, noting the Google-owned platform was the number one viewing site in the US. “YouTube is not just cat videos anymore – YouTube is TV.
“This deal keeps one of the most iconic Hollywood studios healthy and competitive,” Sarandos said. “Warner Bros and Netflix together will create more value for consumers, more opportunities for the creative community, and more American jobs.” Netflix’s annual content spend is currently around $20bn.
Politics
Politics was never far from the proceedings.
When Republican senator Josh Hawley (Missouri) claimed that ”almost half” of the platform’s children’s programming promoted transgender themes, Sarandos said the assertion was inaccurate, adding: ”Netflix has no politcal agenda of any kind […] We feature a wide variety of stories and programmes to meet a wide variety of people’s tastes.”
Republican Senator Eric Schmitt (Missouri) said that 99% of Netflix staff had donated to the Democrat Party and questioned why anyone would approve the deal when Netflix content was “over-sexualised for kids” and said, without citing the source, that over 41% of G-rated children’s content on the platform contained LGBTQIA themes. “The overwhelming majority of your stuff right now is overwhelmingly woke,” Schmitt said, “and it’s not reflective of what the American people want to see.”
Sarandos, who said he was unaware of the statistic, noted, “We have a great deal of programming on Netflix – left, right and centre. We have state-of-the art tools for parents to manage what their kids see on Netflix.”
Asked by Democrat Senator Cory Booker (New Jersey) about his meetings with president Donald Trump and whether it was appropriate for the president to be involved in the merger review, Sarandos said the Department of Justice will decide. He added that when he and Trump met last December they discussed so-called “runaway production” and tariffs and did not specifically discuss the deal.
Booker referenced reports that Trump acquired as much as $2m Netflix and Warner Bros Discovery stock a couple of weeks after the companies announced their deal on December 5.
“I’m hearing from parties who are expressing fear […] about what our society is spiralling towards,” Booker said, “as wealth becomes more concentrated and corporate power and their ability to sway the decisions of politicians becomes greater and greater.”
The proposed merger will go to a vote by the WBD board and faces US and European regulatory scrutiny. Congress cannot approve or block the deal and members on the sub-committee are only able to ask questions and raise concerns.
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