Netflix $NFLX ( ▲ 0.28% ) co-CEO Ted Sarandos went to Capitol Hill to defend the company’s proposed $83 billion acquisition of Warner Bros. Discovery $WBD, and his main argument was clear: the real competitive threat is not traditional media rivals. It is Big Tech.
Lawmakers, meanwhile, are worried about even more power being concentrated in fewer hands.
Sarandos Says Scale Is About Survival
Testifying before the Senate antitrust subcommittee, Sarandos argued that Netflix needs to grow to compete with tech giants like Google $GOOGL ( ▼ 1.96% ) , Amazon $AMZN ( ▼ 2.36% ) , and Apple $AAPL ( ▲ 2.6% ) , which he said are trying to “run away with the television business.” According to Sarandos, these companies have already reshaped what TV is, using deep pockets and massive ecosystems to muscle into entertainment.
He framed the merger with Warner Bros. Discovery as a way to stay competitive in that landscape, not to dominate it. Sarandos also noted that a large share of Netflix subscribers already pay for HBO Max, suggesting the services overlap but are not simple substitutes.
Lawmakers Press on Power and Jobs
Senators raised concerns about the broader impact of media consolidation, including potential job cuts, fewer buyers for original content, and higher prices for consumers. Warner Bros. Discovery executives said the deal would not lead to layoffs, while Sarandos pledged that the combined company would increase US production over the next two years.
He also recommitted to a 45-day exclusive theatrical window for Warner Bros. films, a key issue for the movie industry. Executives argued that creators would still have multiple outlets to sell projects, even as the number of major buyers in Hollywood has shrunk in recent years.
Politics Enters the Chat
Beyond standard antitrust issues, some senators brought up Netflix’s content and political themes, hinting the deal could face scrutiny that goes beyond market concentration. Sarandos responded by emphasizing job creation and US production, positioning the merger as a boost to the domestic entertainment economy.
Despite the heated hearing, betting markets tracking the likelihood of the deal closing were largely unchanged afterward. For now, Netflix $NFLX is fighting on two fronts: convincing regulators it is not too big, while arguing it is still not big enough to fend off Big Tech.