Netflix-Warner Deal: Top UK Lawmakers Demand Antitrust Investigation, Warning Takeover Poses “Stark” Danger To Cinemas & Producers
Netflix is not yet close to completing its $82.7BN takeover of Warner Bros. Discovery (WBD), but the deal is already facing serious opposition in the UK.
A group of 18 influential cross-party lawmakers, including three former culture secretaries and an ex-BBC director general, have written to the UK’s Competition and Markets Authority (CMA) demanding an investigation.
In the three-page missive, addressed to CMA chief executive Sarah Cardell and seen by Deadline, the lawmakers set out a series of concerns about how the Netflix-WBD deal could be “chilling” for UK consumers and businesses.
The lawmakers said Netflix’s takeover would lead to an “unprecedented concentration of power” in the British film and TV industry, potentially pushing up prices for customers and making it harder for UK television networks to compete for ad revenue.
Signed by former BBC boss Lord Tony Hall and ex-culture secretary Sir Oliver Dowden, the letter said the “danger is stark” for British cinema and could “rob” viewers of the big screen experience. Warning that the mega-merger could “reduce the windowing times of releases,” they called on the CMA to secure “formal undertakings” from Netflix on theatrical runs as part of any antitrust process.
The letter also referenced an under-explored concern: The possibility that Netflix could move more of its $6BN content spend in-house in the UK, where it would own Warner Bros International TV Production. This group comprises prominent companies including Who Do You Think You Are? producer Wall to Wall and Twenty Twenty, which makes Harry Potter: Wizards of Baking. It also boasts Warner Bros. Studios Leavesden, the facility at which HBO’s Harry Potter series is being produced.
The Parliamentarians said: “The proposed transaction would not only give Netflix a concerningly high degree of pricing power, but also enable Netflix to foreclose competition by restricting production at Warner Bros. Television Studios. It is highly likely Netflix would bring more production in-house, reducing its spend with UK independent production companies.”
Lord Chris Smith and Dame Karen Bradley, two former culture secretaries, were among the 18 signatories. Others included Baroness Tina Stowell, former chair of the Lords Communications and Digital Committee, and Lord Guy Black, chair of the News Media Association and deputy chair of Telegraph Media Group. Lord Ed Vaizey, an ex-culture minister, also signed.
They said: “The CMA is the only body with the power to ensure that the interests of British consumers, creatives and our cinema industry are safeguarded. We believe it is imperative that the CMA conduct a full and thorough investigation into the proposed acquisition of Warner Bros. Discovery’s streaming and studios assets by Netflix.”
The CMA declined to comment. A Netflix spokesperson said: “We are in contact with regulatory bodies in all relevant jurisdictions, including the CMA. We’re highly confident in the regulatory process. This deal is pro-consumer, pro-innovation, pro-worker, pro-creator and pro-growth.” WBD was approached for comment.
The lawmakers’ intervention comes after Deadline reported earlier this month that Paramount CEO David Ellison, who is rivalling Netflix’s bid for WBD, met with UK culture secretary Lisa Nandy to discuss the deal. Sources said preservation of cinema was a key talking point.
Netflix considers the UK to be one of its most important bases outside of the U.S. Netflix UK chief Anne Mensah has overseen a period of huge success for the streamer, with UK originals like Adolescence and The Gentlemen featuring among its most-watched series globally. Recent British originals include Agatha Christie’s Seven Dials, made by Orchid Pictures.
The Financial Times first reported on the letter to the CMA.
