When large companies start talks about- let alone the process of mergers and acquisitions- there are a number of things to be worried about. The bigger the company, the more at stake for employees, stockholders, the competitive business environment, and consumers. That’s why big moves have to be approved by various government organizations; which will happen with the entertainment juggernaut Warner Bros. Discovery possible sale. As the politics begin to play out, a lobbyist group representing theater owners is adamantly telling the United States Government this sale must not happen.
Things have been moving with tremendous force after Skydance acquired Paramount. Following that, Paramount Skydance started setting its sights on Warner Bros. Discovery. The latter of which was a mess of a merger in its own right. Surprisingly, it was Netflix who made an offer WBD accepted. Though the end result still remains in flux with Paramount Skydance submitting 8 offers WBD has subsequently declined.
No matter who’s involved, Cinema United wants to stop it altogether. The organization represents theater owners and exhibitors, and views any sale or merger involving WBD to be a danger to the film industry.
“Amid this backdrop of significant M&A activity, Netflix is now seeking to acquire Warner Bros., a streaming competitor that controls a significant library of shows and movies,” the group said in a statement. “If Netflix’s proposed acquisition of Warner Bros. is not challenged, the threat to our members is grave — and possibly even existential — given its hostility toward exhibition.” What they’re referring to is how Netflix is generally not a friend of movie theaters, and would prefer to avoid long theatrical runs, or perhaps any run at all, in favor of putting movies on their streaming service as quickly as possible. (Even though Netflix does own a few theaters, including the historic Egyptian Theater in Hollywood, CA.)
On the other hand, they point out a Paramount Skydance purchase would also prove substantially dangerous to the film industry. “A combination of Paramount and Warner Bros., for instance, would consolidate as much as 40 percent of each year’s domestic box office in the hands of a single dominant studio.” Not to mention a fewer number of studios also means fewer places to shop films around, which is bad for filmmakers as well as the theaters themselves.
It’s absolutely a lose-lose situation for Cinema United. As much as the term “lobbyist group” is spoken with derision, sometimes these groups absolutely have valid points for the industry they represent. This is one of those times. As we indicated prior with our previous reporting, this is just one part of a much larger story. We’ll continue to update you in the weeks and months to come.
