Documentary filmmakers, independent movie theaters, and nonprofit groups are asking state attorneys general to prevent Netflix Inc. (NFLX) from buying the streaming and studio assets of Warner Bros. Discovery Inc. (WBD), Bloomberg reported on Thursday.
The report, citing a letter the group sent to the National Association of Attorneys General, said the deal between the two media companies will increase prices for consumers, restrict competition in Hollywood, and hurt movie theaters.
“This deal raises serious antitrust concerns that enforcers should closely scrutinize, as any such deal would deepen the media consolidation crisis, hurting creators, workers, consumers, and the public writ large,” the letter, signed by groups including the International Documentary Association, American Economic Liberties Project, and Art House Convergence, reportedly said.
In an extensive interview with The New York Times earlier this month, Netflix co-chief executive Ted Sarandos reassured that his company’s $82.7B deal for the HBO parent’s coveted assets will not hurt the theatrical industry and acknowledged that concerns raised by Hollywood critics about the deal were “rightfully so.”
He is expected to testify in front of a U.S. Senate committee that is scrutinizing the deal in February.
In the UK, several politicians and former policymakers have raised fears that the Netflix-WBD deal “will cement an already dominant player” in the TV streaming market.
In the U.S., Senators Elizabeth Warren and Mike Lee, among others, have strongly opposed the deal, but President Donald Trump has spoken in favor of Paramount Skydance Corp. (PSKY) over Netflix, notably due to David and Larry Ellison’s strong ties with the current administration.
Analysts largely believe Netflix will eventually succeed against rival Paramount (PSKY), who started the bidding war in the first place, but the streaming giant’s deal is considered more complicated from an antitrust perspective due to its dominant position in subscription video-on-demand across Europe.
European competition watchdogs earlier this month said they will simultaneously examine bids submitted by Netflix and Paramount for Warner’s assets.
Brussels is expected to have unusual leverage over Warner’s destiny, as they could swiftly clear the deal for one bidder and launch a more in-depth investigation for the other, thus paving a path for a frontrunner to emerge eventually, Bloomberg previously reported.