Netflix Buying Another Comic Company

Netflix is the winning bidder of the auction for Warner Bros. Discovery after a second round of bidding concluded this week (see “Bidding Second Round“), the companies announced.  In the transaction, Netfllix acquires its second comic company and the Warner Bros. movie and tv studios and streaming business. 

The deal would combine ownership of DC Comics and Millarworld (which Netflix acquired in 2017, see “Millarworld Acquired by Netflix”), the Netflix and HBO Max streaming services, the Netflix and Warners movie and TV production capacity (which includes Warner Bros.’ Burbank studio), and the intellectual property rights owned by the two media giants. 

The transaction is at “definitive agreement” stage, which leaves a couple of key steps before the transaction is complete.  First, Warner Bros. Discovery must complete its planned spin-off of Discovery Global, which will include cable networks CNN, TNT, Cartoon Network and a raft of others, as well as Warner Bros. International Television Production, all assets that Netflix doesn’t want or need.  That’s expected to take place in Q3 of 2026. 

The transaction will also have to clear regulatory approvals, which include U.S. and European examinations of whether the size of the transaction creates anti-trust issues. In the U.S., opposition is forming from multiple camps.  An unnamed “senior administration official” told CNBC on Friday that it viewed the deal with “heavy skepticism,” while Dem Senator Elizabeth Warren called the deal “an anti-monopoly nightmare,” according to CNBC. One key question will be how regulators view the total market for streaming video; including user-generated content on TikTok and YouTube reduces the combined share of Netflix and Warner Bros. to levels that could pass muster.

There’s also a lot of angst in Hollywood about the impact of an acquisition by Netflix, which releases its features for short windows if at all, on the theatrical movie business. Furthermore, actors and other creative types worry that consolidation of ownership reduces the competition for talent, putting more negotiating leverage in the hands of a handful of companies. 

An added twist is that a bid to buy all the assets by Trump ally Paramount Skydance, backed by three oil state sovereign wealth funds (Saudi Arabia, Qatar, and Abu Dhabi, according to Variety), was rejected in favor of the Netflix bid. That bid included the cable networks, which did not go to Netflix and are being spun off.

The transaction would take Netflix into some new businesses, including parks and publishing, both in Warner Bros.’ Games & Consumer Product & Experiences division. Netflix has historically licensed its properties to third parties for those businesses (Millarworld to Dark Horse for comic publishing and to Wizards of the Coast for tabletop RPGs, as examples), so we’ll be watching when new management finishes taking over and works its way down to those relatively small divisions to decide what to do with them. Netflix made a general statement that it “expects to maintain Warner Bros.’ current businesses, including operations of the motion picture and television studio, theatrical releases for films, and HBO Max and HBO,” illustrating its intentions with logos of businesses it expected to maintain, which included DC Studios, but that included no mention of publishing.