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1 day agoShareSaveOsmond ChiaBusiness reporterShareSaveAFP via Getty Images
US President Donald Trump has flagged potential concerns over Netflix's planned s movie studio and popular HBO streaming networks.
At an event in Washington DC on Sunday, he said Netflix has a "big market share" and the firms' combined size "could be a problem".
On Friday, the two companies said they had reached an agreement to bring Warner Brothers' franchises like Harry Potter and Game of Thrones to Netflix, creating a new media giant.
The planned deal, which has raised concerns among some in the industry, is yet to be approved by competition authorities. The BBC has contacted Warner Bros, Netflix and the White House for comment.
Launched in 1997 as a postal DVD rental business, Netflix has grown to become the world's largest subscription streaming service. The deal, the biggest the film industry has seen in a long time, would cement its number one position.
Under the agreement several global entertainment franchises, such as Looney Tunes, The Matrix and Lord of the Rings, would move to Netflix.
The deal is expected to be completed after Warner Bros splits its business in the second half of 2026.
The US Justice Department's competition division, which oversees major mergers, could contend that the deal violates the law if the combined businesses account for too much of the streaming market.
At an event at the John F Kennedy Center in the US capital, Trump said that Netflix has a "very big market share" which would "go up by a lot" if the deal goes ahead.
Trump added he would be personally involved in the decision on whether or not to approve the deal and repeatedly highlighted the size of Netflix's market share.
He also said that Netflix's co-CEO Ted Sarandos recently visited the Oval Office and praised him for his work at the company.
"I have a lot of respect for him. He's a great person," said Trump. "He's done one of the greatest jobs in the history of movies."
Mr Sarandos earlier acknowledged that the agreement may have surprised investors but said it was a chance to position Netflix for success in the "decades to come".
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Blair Westlake, a media executive and former chair of Universal Studios' television and networks group, told the BBC's Today programme that "the only two pieces that matter" when it came to competition concerns were the combination of Netflix and Warner Brothers' HBO streaming business.
"Netflix is not in the studio production business the way Warner Brothers is, and even the library size of films and television programming that Netflix owns pales in comparison to Warner," he said.
However, while the Netflix deal would give it a strong position in video streaming, experts have said it would not look so dominant if regulators adopt a broader definition, to include cable and broadcast TV and also YouTube as competitors.
"A lot of people don't realise that the number one place that consumers in the world go for viewing of content consumption is YouTube, and it's far and away beyond anything else," said Mr Westlake.
He added he thought the deal would eventually be approved, but "I think that there will probably be concessions that have to be made".
Bill Kovacic, a former chair of the US competition watchdog the Federal Trade Commission, told the Today programme that Trump's comments meant negotiations over any problems surrounding the deal were "going to run through the White House".
"That means that we're going to have probably a deep level, an unprecedented level of presidential control in the resolution of what used to be a technical analysis of a merger," he said.
Netflix beat several rivals including Comcast and Paramount Skydance to strike an agreement with Warner Bros.
Paramount Skydance, which is headed by David Ellison, had previously tried to buy all of Warner Bros, including its cable networks.
Warner Bros rejected that approach before putting itself up for sale.
David Ellison's multi-billionaire father, Larry Ellison, is a close ally of Trump.
The Writers Guild of America's East and West branches called for the merger to be blocked, saying the "world's largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent."
"The outcome would eliminate jobs, push down wages, worsen conditions for all entertainment workers, raise prices for consumers and reduce the volume and diversity of content for all viewers," it said on Friday.
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International BusinessDonald TrumpNetflixHollywood
Original aticle here: BBC
