Theater Owners Urge Senate Against “Catastrophic” Netflix-Warner Bros Merger
Cinema United, a leading trade organization representing the cinema exhibition industry, has raised concerns about the proposed merger between Netflix and Warner Bros. The organization has submitted a six-page testimony to the Senate Judiciary Subcommittee on Antitrust, Competition Policy & Consumer Rights, emphasizing the potential negative impacts of this acquisition.
Concerns Over Netflix and Warner Bros Merger
The merger, if approved, could lead to significant economic and cultural challenges. Cinema United warns that the acquisition could result in:
- Fewer theaters operating across the nation.
- Shorter theatrical release windows for films.
- Declining revenues and job losses in the entertainment sector.
- Reduced options for consumers interested in theatrical movie experiences.
Cinema United, previously known as the National Association of Theatre Owners, stresses that this merger may further consolidate movie production and distribution. This is particularly concerning in a market that is already heavily dominated by a few players.
The 45-Day Exclusive Window Debate
Netflix co-CEO Ted Sarandos has publicly stated that the platform plans to implement a 45-day exclusive theatrical window for new films. However, industry rivals have expressed skepticism about this timeline’s implications.
Typically, when distributors mention a 45-day window, they refer to the period before the film is available for premium video on demand (PVOD). This model could severely disrupt the existing market dynamics, where theatrical releases usually have a window of 90 to 100 days before transitioning to streaming platforms.
Impact on the Industry
The trade group highlights that the potential merger could create an entity controlling a large share of the domestic box office. For example, a combination of Paramount and Warner Bros. could equate to 40% of annual box office gross under a single studio.
Cinema United emphasizes the importance of maintaining a diverse and varied pipeline of films. They assert that while the production of theatrical films is gradually approaching pre-pandemic levels, this recovery may stall due to increased consolidation in the industry. Such consolidation has historically led to fewer films being produced.
Industry’s Future at Stake
Cinema United concludes with a warning: lessons from history indicate that further consolidation often results in fewer movies being made. The organization represents over 31,000 movie screens across the United States and an additional 30,000 screens in 80 countries worldwide. Their statements reflect a deep commitment to the vitality of theaters and the broader film industry.
