Warner Bros. hasn’t been doing well financially for some time. There are several reasons for that, but CEO David Zaslav hasn’t helped. The studio’s financial woes came to light when it was announced they were up for sale earlier this year, leaving everything to whichever studio was willing to bite. The odds appeared to be with Universal/Paramount, since President Trump was hoping for that merger, but Netflix swooped in at the last minute. While, as of writing this, there are last-minute details that need finalizing, given how everything’s playing out it’s likely that this’ll go through.
Which brings me to my first few questions: how long will this take? What are the next steps for the two companies? Mergers are often slow and tedious, based on what I’ve seen, so there are many variables up in the air. I know CNN and The Discovery Channel won’t be impacted, as per the agreement, but everything else will be. And it’s a lot.
How will this merger operate? Will David Zaslav remain CEO of Warner Bros.? Will he be co-CEO alongside Netflix? Will Netflix’s CEOs take over running Warner Bros.? Or will Netflix find a brand new CEO?
Will Warner Bros. retain its namesake, or will it be renamed? That was a sticking point with the Disney/Fox merger, with the latter being renamed 20th Century Studios. If that happens with Warner Bros., will its new name be something more corporate? I can see “Bros.” being dropped, since none of the brothers are alive, but axing “Warner” feels dishonest. Like removing “Walt” from “Walt Disney”, it’d be like losing a part of history.
What’ll happen to Warner Bros.’ catalogue? Recall that Warner Bros. has been around for over a century, and they have a massive library of shows and movies. Like MGM, Warner Bros. remained a mainstay through their highs and lows, and that’s been exemplified with their output. If this merger’s finalized, will Netflix treat its new backlog with more respect than Zaslav? Or will it treat it worse?
What’ll happen to the shows and projects Warner Bros. was working on beforehand? Will they be axed? Will the reboot of the Harry Potter franchise still happen as planned? Will there be more Lord of the Rings content? Will James Gunn’s reboot of the DCU continue, especially since he’s had a promising start?
What’ll happen to Warner Bros.’ catalogue? Recall that Warner Bros. has been around for over a century, and they have a massive library of shows and movies. Like MGM, Warner Bros. remained a mainstay through their highs and lows, and that’s been exemplified with their output. If this merger’s finalized, will Netflix treat its new backlog with more respect than Zaslav? Or will it treat it worse?
What’ll happen to the shows and projects Warner Bros. was working on beforehand? Will they be axed? Will the reboot of the Harry Potter franchise still happen as planned? Will there be more Lord of the Rings content? Will James Gunn’s reboot of the DCU continue, especially since he’s had a promising start?
What about HBO? Will HBO run independently? Will Last Week Tonight continue on, or will John Oliver’s late-night bloc get axed? Will all currently-syndicated programs on HBO continue, or will they be axed too? And if so, to what extent?
How about foreign licenses? The biggest one is, of course, Studio Ghibli. They already have Western distribution rights through HBO and Netflix, depending on where you live, so the custody battle will be on the table. What’ll happen? Will nothing change, or will everything change?
For Netflix, will there be an overhaul? Netflix recently put out a statement that they are no plans for price increases, but for how long? If the price increases, by how much? And if it doesn’t, does that mean HBO and Netflix will remain separate bundles, or will they be merged?
How about foreign licenses? The biggest one is, of course, Studio Ghibli. They already have Western distribution rights through HBO and Netflix, depending on where you live, so the custody battle will be on the table. What’ll happen? Will nothing change, or will everything change?
For Netflix, will there be an overhaul? Netflix recently put out a statement that they are no plans for price increases, but for how long? If the price increases, by how much? And if it doesn’t, does that mean HBO and Netflix will remain separate bundles, or will they be merged?
How will this impact movie releases? Will Warner Bros. release everything, or will they scale back? Will Netflix release more movies theatrically, as opposed to special events? I know Netflix co-CEO Ted Sarandos has stated he’s never been fond of the theatregoing experience, but will that mentality change now? Will Sarandos be more receptive to theatres?
How many jobs will be cut during restructuring? This was a sticking point for Disney after absorbing 20th Century Fox, and it’s going to happen here too. I doubt the higher ups will suffer, but will grunt workers have to find new employment? Will there be pushback? And how much pushback?
How does this impact holdings? I know it sounds weird to ask that, but mergers are financially-motivated and impact shares in a company. Will Netflix and Warner Bros. see stock surges? Will one or the other drop in the short term? Will investors only see long-term payoffs?
How many jobs will be cut during restructuring? This was a sticking point for Disney after absorbing 20th Century Fox, and it’s going to happen here too. I doubt the higher ups will suffer, but will grunt workers have to find new employment? Will there be pushback? And how much pushback?
How does this impact holdings? I know it sounds weird to ask that, but mergers are financially-motivated and impact shares in a company. Will Netflix and Warner Bros. see stock surges? Will one or the other drop in the short term? Will investors only see long-term payoffs?
The biggest elephant in the room, maybe the second-biggest, involves long-term retention. I think back to what caused MGM to get scooped up by Amazon: frequent sales and buybacks. The late-Kirk Kerkorian owned MGM three times, each time selling the company for spare parts to help finance real estate. Given his tenure doomed MGM, who’s to say Warner Bros., which has been sold several times, won’t suffer the same fate should another Kerkorian-like figure pop up?
Most-importantly, why’s this merger happening now? And why’s The FCC approving it, like they did Disney and 20th Century Fox? If The FCC’s purpose is to monitor corporate mergers, then why’s there no pushback here? Perhaps my personal politics are getting in the way, but isn’t this corporate overreach? Am I wrong to assume that?
It's possible that these questions, and more, will be answered in the future. I’m not a fortune teller, after all. But that I’ve posed them at all should be cause for short-term alarm, assuming they hold weight legally. I also don’t know enough about corporate politics to be an expert, so all my questions should be taken with a grain of salt. Nevertheless, I’m worried about the future of filmmaking. Even if I’m not fond of how David Zaslav has managed Warner Bros., I’m not sure this is the answer. We’ll have to wait and see.
Most-importantly, why’s this merger happening now? And why’s The FCC approving it, like they did Disney and 20th Century Fox? If The FCC’s purpose is to monitor corporate mergers, then why’s there no pushback here? Perhaps my personal politics are getting in the way, but isn’t this corporate overreach? Am I wrong to assume that?
It's possible that these questions, and more, will be answered in the future. I’m not a fortune teller, after all. But that I’ve posed them at all should be cause for short-term alarm, assuming they hold weight legally. I also don’t know enough about corporate politics to be an expert, so all my questions should be taken with a grain of salt. Nevertheless, I’m worried about the future of filmmaking. Even if I’m not fond of how David Zaslav has managed Warner Bros., I’m not sure this is the answer. We’ll have to wait and see.
In the meantime, whether you agree or disagree, these are my thoughts. Perhaps those of you reading this will know more than me, I can’t say.
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