The 83 billion dollar Netflix Warner Bros deal is official, and the mood in Hollywood has shifted from anxiety to pure anger.
Jane Fonda is raging about it in a letter, calling it an alarming escalation that threatens the entire industry. The Writers Guild of America released a statement saying, "This merger must be blocked. The world’s largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent." The Teamsters are demanding every level of government "reject this deal."
Netflix is trying to calm people down. Ted Sarandos, Netflix’s co CEO, went on a call with investors and promised that Warner Bros movies will still go to theaters, saying, "Right now, you should count on everything that is planned on going to the theater through Warner Bros to continue to go to theaters."
But nobody in town believes him. One agent pointed out the key words, "right now," and everyone remembers Sarandos calling theaters "an outmoded idea" just a few months ago.
The fear is all about jobs. Entertainment workers in LA from camera operators to writers have already been through hell with pandemic shutdowns, two union strikes, and productions leaving town. Everyone knows "consolidation" is just a nice word for "job loss." It happened when Disney bought Fox, and it's happening right now with layoffs at Paramount.
So politicians are weighing in. Rep. Laura Friedman, who represents Burbank, said any merger should be evaluated on its impact on jobs and competition, adding, "I’ll be watching this deal closely." LA Mayor Karen Bass gave a careful statement about boosting local production. City Council member Katy Yaroslavsky said, "LA’s entertainment sector is in crisis, and the question is whether this deal strengthens production here or sends more work elsewhere."
But here’s the thing that makes you wonder. Where were all these fiery statements and demands two weeks ago? The bidding war between Netflix, Comcast, and Skydance was public knowledge. Why didn't the WGA, SAG, and every LA politician hold immediate press conferences then? Why didn't they meet with each bidding company to set hard rules about jobs and competition before a winner was chosen? It's the same old pattern, wait until the deal is done, then swing into protest mode. It's like these institutions are wired only for opposition and strikes, never for actually steering the ship before it crashes.
And now we get to the most awkward part of all, the part people in LA are whispering about privately. The deal needs federal approval.
A high level aide to a City Council member, speaking anonymously, spelled out the new fear, "Netflix has a lot of jobs here. But the Federal Communications Commission would have to approve the deal, and the worry would become what Netflix needs to do to appease Trump."
Let that sink in. After all the talk, Hollywood's fate might now hinge on the approval of the Trump administration. The same people who have spent years in opposition are now potentially relying on the very government they've criticized to save them from this deal. The irony is so thick you could cut it.
Others are worried about creativity. Entertainment lawyer Chris Perez said his phone hasn't stopped ringing, and his big concern is about indie films, "Where you only have a few buyers, they’d rather have something that’s less risky, and you get safer, less controversial content. Consolidation has the potential to kill creativity."
Michele Mulroney, president of the Writers Guild West, didn't hold back, calling the merger "a disaster" and saying, "These mergers always promise benefits, but they always deliver diminished competition, lower pay and fewer jobs for workers. It’s a very dismal day."
So the anger is everywhere, from Jane Fonda to the head of the WGA. But the real question is, why is the plan always to get angry after the fact? And are they really prepared for the political reality that the deal's fate may now be in the hands of an administration they've spent years campaigning against?