Eleven state attorneys general have formally requested that the Department of Justice perform a detailed antitrust review of Netflix's proposed purchase of Warner Brothers, citing risks to competition, consumers, and the theatrical film sector.
In a letter dated Tuesday addressed to Acting Assistant Attorney General Omeed Assefi, the group warned that the merger could reduce competition in the Subscription Video on Demand market and adversely affect both content quality and pricing for subscribers. The submission was led by Montana Attorney General Austin Knudsen and was signed by the attorneys general of Alabama, Alaska, Iowa, Kansas, Nebraska, North Dakota, South Carolina, Tennessee, Utah, and West Virginia.
The state officials referenced an ongoing private lawsuit filed in the Eastern District of California that seeks to block the acquisition under the Clayton Act. That complaint alleges the deal would substantially lessen competition or create a monopoly, in part by eliminating HBO Max as a distinct competitor in the streaming marketplace.
A central concern highlighted in the letter is the potential for vertical foreclosure of content libraries that rival streaming services rely on. The attorneys general cautioned that if Netflix absorbs Warner Brothers' content, competing platforms could lose access to critical titles and other input necessary to compete effectively, which in turn could allow a dominant owner to raise subscription prices while offering a narrower slate of programming of lower quality.
The letter also raised alarms about possible consequences for the theatrical motion picture business. The state officials noted earlier comments attributed to Netflix's chief executive that labeled movie theaters as an outdated concept. They said that background fact increases concern that Netflix could change or abandon Warner Brothers' existing theatrical release strategy if the acquisition proceeds.
Representatives of the exhibition sector have voiced alarm as well. Cinema United, a trade group representing major theater chains including AMC and Regal, characterized the proposed deal as culturally catastrophic. The attorneys general emphasized that the timing of the proposed consolidation could be particularly damaging to theaters, which are still in recovery from the COVID-19 pandemic and have been affected by recent Hollywood labor strikes.
Specifically, the state officials argued that allowing Netflix to acquire Warner Brothers on the current timeline could deprive the exhibition sector of important cash flows at a moment when cinemas are preparing for two significant years on the box office calendar. The attorneys general framed that timing as an added reason for the Department of Justice to undertake careful scrutiny.
Finally, the coalition offered to support the Department of Justice in its review of the proposed transaction, signaling a willingness to assist federal regulators as they evaluate the competitive and industry-specific implications.
Context note - The article reports on the contents of the attorneys general's letter and the referenced lawsuit, and on statements attributed to industry groups and a chief executive as presented in the letter and supporting materials.