Netflix’s proposed $72 billion merger with Warner Bros Discovery is drawing intense scrutiny from regulators. The streaming giant claims the acquisition is necessary to compete with YouTube, America’s largest TV distributor by viewing time. However, antitrust experts remain skeptical, noting that Netflix’s premium scripted content differs significantly from YouTube’s user-generated videos. Consequently, regulators question whether audiences actually consider the two platforms interchangeable.
The merger would combine Netflix and HBO Max, totaling roughly 428 million subscribers globally. Netflix argues that limited daily viewing time forces consumers to choose between entertainment options, positioning YouTube as a competitor. Yet experts highlight that Netflix invests billions in original series and films, consistently dominating streaming rankings. Subscribers pay monthly fees between $7.99 and $24.99, and while advertising is growing, it remains a secondary revenue stream. In contrast, YouTube thrives on user-created content, music videos, tutorials, and influencer-driven engagement, generating revenue primarily through ads. The platforms therefore attract very different audiences and viewing habits, making the rivalry argument weak.
Regulators also understand content markets in depth and rarely accept overly broad definitions of competition. Historically, authorities focus on specific sub-markets, pricing models, and consumer behaviors. For subscription-based platforms, scripted streaming represents a distinct market from ad-supported video platforms. Moreover, recent reforms require Netflix to submit internal competition analyses earlier in the review process, giving regulators more insight into how the company perceives its rivals. If internal documents underplay YouTube’s relevance, the merger’s defense could be further weakened.
Netflix has also pitched the deal as offering cost savings for overlapping HBO Max and Netflix subscribers through bundling. However, authorities often view such claims skeptically, questioning whether benefits actually reach consumers. They will also consider whether non-bundled subscribers could face higher prices post-merger. While combined, Netflix and Warner Bros would expand market share in scripted streaming, YouTube still commands more overall viewing time, highlighting the differences in content consumption.
Ultimately, Netflix’s argument that it must merge with Warner Bros to rival YouTube faces significant regulatory hurdles. Authorities will carefully evaluate content differences, internal strategies, pricing models, and consumer impact. As scrutiny grows, the deal’s approval remains uncertain, leaving the future of this high-profile merger in a delicate balance.
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