Netflix Co-CEO Questioned by U.S. Senate Committee Over Warner Bros. Acquisition Deal

　　Netflix Co-CEO Ted Sarandos attended a U.S. Senate hearing on Tuesday, where he was questioned about the company's proposed $82.7 billion acquisition of Warner Bros. Discovery. The hearing mainly focused on the impact of this deal on competition within the streaming entertainment industry.

　　U.S. Senator Mike Lee presided over the hearing, with Sarandos and Warner Bros. Chief Strategy Officer Bruce Campbell expected to testify. Although the Senate does not have the authority to block the deal itself, the hearing allowed lawmakers to demand that Netflix elaborate on how the acquisition would affect consumers, industry professionals, and competitors.

　　The U.S. Department of Justice is currently reviewing the deal, while Paramount - Skydance Media has also made a competing hostile takeover offer for Warner Bros.

　　Both Netflix and Paramount - Skydance Media are vying for Warner Bros. because the company owns leading film and television production studios, a vast content library, and a portfolio of major classic IPs, including "Game of Thrones," "Harry Potter," and DC Comics’ Batman, Superman, and other superheroes.

　　Paramount claims its acquisition proposal would be easier to pass regulatory approval. However, Warner Bros. has repeatedly rejected Paramount's offers, and Paramount would have to take on massive debt to finance the transaction.

　　Paramount’s CEO is David Ellison, whose father is Oracle co-founder and billionaire Larry Ellison. Larry Ellison is known to have close ties with former U.S. President Donald Trump.

　　Mike Lee, a Republican senator from Utah and chair of the Senate antitrust subcommittee, has been critical of the acquisition since it was announced last December. Lawmakers from both major U.S. parties have raised concerns, arguing that the deal could weaken competition in the streaming market.

　　Netflix cited data from media analytics company Nielsen, claiming that on U.S. television, YouTube, owned by Google, leads all other streaming platforms in watch time. However, experts have suggested that the Department of Justice may analyze the competitive impact of the deal in more segmented market categories, such as subscription-based streaming platforms.

　　Mike Lee also questioned whether Netflix truly intends to acquire Warner Bros., or if it is attempting to use the DOJ’s antitrust review (which could take more than a year) to stall Warner Bros.’ competitive progress.

　　The Republican senator has demanded that Netflix disclose whether its employees have already accessed Warner Bros.’ sensitive information. He believes this could give Netflix a competitive advantage before the completion of the transaction.

　　In a letter to Netflix in January, Mike Lee wrote: “Access to such sensitive information could give rise to anti-competitive behavior, including copying projects Warner Bros. is developing, stealing its strategic plans, or mimicking its algorithmic targeting strategies.”

Editor: Guo Mingyu