Netflix’s $NFLX ( ▲ 1.65% ) proposed $83 billion acquisition of Warner Bros. Discovery $WBD ( ▲ 2.24% ) is facing deeper scrutiny from the Justice Department, which is reportedly widening its investigation into the streamer’s broader business practices. At least one other entertainment company has been subpoenaed as regulators examine whether the deal could harm competition.
Netflix says the review is routine and expects the acquisition to ultimately win approval. Still, the expanding probe signals that regulators are not just looking at the merger itself but also at how Netflix operates within the entertainment ecosystem.
What Regulators Are Looking For
According to reporting, the DOJ is gathering information on whether Netflix has engaged in anticompetitive tactics and how consolidation in streaming and entertainment could impact rivals. The review is not happening in a vacuum. Regulators are also looking more broadly at how major media mergers, including deals involving companies like Paramount Global $PSKY ( ▲ 0.38% ) , could reshape the competitive landscape.
At the heart of the concern is whether combining Netflix’s massive streaming platform with Warner’s film and TV library could give the company too much control over premium content.
Netflix’s Defense: We Compete With Everyone
Netflix has pushed back on the idea that the deal would reduce competition. The company argues that there is already heavy overlap between Netflix and HBO Max audiences and that its real competition goes far beyond traditional streaming rivals. It points to platforms like YouTube, owned by Alphabet $GOOGL ( ▼ 2.53% ) , and TikTok as key competitors for viewer attention.
Financially, Netflix reported $45.2 billion in revenue in 2025, compared with YouTube’s roughly $60 billion, underscoring how crowded the broader digital entertainment field has become.
The Theater Window Debate
Another sticking point is how Warner Bros. films would be released under Netflix ownership. Netflix has said it plans to stick with a 45-day theatrical window before movies move to streaming. Theater industry groups argue that many films typically spend far longer in premium video-on-demand windows before landing on subscription platforms, often averaging around 102 days.
Shorter windows could shift more power toward streaming and away from traditional theaters, adding another layer to regulators’ concerns about how the deal might reshape the movie business.
For now, the merger is moving forward under the watchful eye of antitrust officials, and the outcome could help define how much consolidation regulators are willing to tolerate in the streaming era.