Netflix co-CEO Ted Sarandos told a Senate antitrust subcommittee that subscribers could simply cancel if a proposed deal to acquire Warner Bros. Discovery’s streaming and studio assets made the service too costly. The remarks came during a hearing of the U.S. Senate Judiciary Committee’s Subcommittee on Antitrust, Competition Policy, and Consumer Rights on February 4, 2026, where Sarandos defended the proposed transaction as pro-consumer. Netflix stressed the combined companies would increase content for many viewers while keeping the market competitive. Regulators and some lawmakers remain concerned about potential price effects and concentration in streaming and content production.
Key Takeaways
- Netflix argued the merger would expand content without reducing competition; the company emphasized 80% of HBO Max subscribers also use Netflix, calling the services “complementary.”
- Netflix reported 301.63 million global subscribers as of January 2025; Warner Bros. Discovery’s streaming footprint totals roughly 128 million subscribers across HBO Max and Discovery+.
- Sarandos reiterated that Netflix raised prices in January 2025 but said those hikes came with “a lot more value” for customers and that users can cancel with a single click.
- Sen. Amy Klobuchar pressed Netflix on affordability and sought assurances the merger would not make streaming prohibitively expensive for consumers.
- Sarandos said the company is engaging with the U.S. Department of Justice about potential guardrails to limit future price increases if the deal clears regulatory review.
Background
The proposed acquisition of Warner Bros. Discovery’s streaming and studios businesses by Netflix is one of the highest-profile consolidation efforts in the streaming era, raising questions about market concentration and consumer pricing. Streaming platforms have proliferated since the mid-2010s, fragmenting audiences and prompting firms to expand content libraries and distribution footprints to retain and grow subscribers. Netflix remains the largest subscription video-on-demand (SVOD) service globally by subscriber count, while Warner Bros. Discovery holds substantial premium content through HBO Max and Discovery+.
Antitrust authorities have scrutinized large media deals more closely since mergers such as AT&T-Time Warner and Disney-21st Century Fox, which prompted sustained regulatory review and litigation in some cases. Lawmakers and regulators say they are particularly attentive when a deal could reduce the number of independent, large-scale content producers or give a single firm disproportionate leverage over prices and distribution. Consumer groups have warned that consolidation can lead to higher prices, reduced choice, or less bargaining power for distributors and device makers.
Main Event
At the Feb. 4, 2026 hearing, the Senate Judiciary subcommittee examined the competitive effects of the proposed Netflix–Warner Bros. Discovery transaction. Sarandos framed the deal as complementary, stressing overlapping audiences and the incremental value the combined libraries would bring. He told senators the overlap—an 80% crossover figure Netflix cited—meant many households already pay for both services, reducing the risk that the transaction would eliminate distinct consumer options.
When questioned about affordability, Sen. Amy Klobuchar referenced Netflix’s January 2025 price increase and pressed Sarandos on how the company would prevent further hikes that would burden subscribers. Sarandos pointed to industry competition and argued that prior price increases accompanied increased content and features. He repeatedly highlighted Netflix’s simple cancellation mechanism as a consumer protection: if users judge value insufficient, they can leave with one click.
Sarandos also described ongoing talks with the U.S. Department of Justice about potential safeguards tied to the merger. He characterized those discussions as part of a collaborative process to address antitrust concerns and asserted the deal posed no meaningful concentration risk for streaming or content production. Lawmakers on the panel, however, signaled they would weigh independent analyses and market data before reaching conclusions.
Analysis & Implications
If regulators approve the transaction, the combined firm would control a larger share of premium scripted content, high-profile franchises, and streaming distribution. That scale may deliver efficiencies—lower per-subscriber content costs, broader content bundles and increased investment capacity—but it also raises the potential for greater pricing power. Netflix’s argument that 80% of HBO Max subscribers already subscribe to Netflix is intended to show redundancy, yet it also reflects high overlap that could reduce competitive pressure in some market segments.
Price dynamics in streaming are complex: platforms set prices based on content spend, subscriber growth targets, and monetization strategies including ad tiers. Netflix’s January 2025 price rise followed continued content investment; the company maintains that higher pricing has been offset by additional value. Nonetheless, larger market share could change incentives for future pricing—hence the focus on guardrails and enforceable conditions that regulators might seek from the DOJ to constrain unilateral price-setting.
Beyond domestic pricing, the deal’s global implications matter. Netflix serves subscribers across dozens of markets, and combining Warner Bros. Discovery assets would alter global content licensing, local production financing and distribution negotiations. International regulators may therefore weigh impacts differently than U.S. authorities, potentially imposing market-specific remedies or scrutinizing vertical links between studio production and distribution.
Comparison & Data
| Service | Reported global subscribers | Representative date |
|---|---|---|
| Netflix | 301.63 million | January 2025 |
| Warner Bros. Discovery (HBO Max & Discovery+) | 128 million | Company reports |
The table shows the relative scale of the two firms’ streaming footprints. Netflix’s subscriber base is more than double Warner Bros. Discovery’s streaming total, but WBD owns premium scripted output and franchise IP that could shift content bargaining power if combined. Market share by subscribers is only one dimension; content ownership, production capacity and distribution relationships are equally important to competitive analysis.
Reactions & Quotes
Senators and industry observers issued cautious statements after Sarandos’ testimony, signaling that scale alone will not determine regulatory outcomes and that concrete remedies may be required.
“We need concrete answers about affordability and choice if this deal moves forward.”
Sen. Amy Klobuchar (D-Minnesota), Senate Judiciary Subcommittee
Context: Sen. Klobuchar pressed Netflix on the practical effects of past price increases and sought commitments that a merged company would not make streaming unaffordable for families. Her line of questioning focused on consumer protections rather than technical market definitions.
“We will give consumers more content for less,”
Ted Sarandos, Netflix co-CEO
Context: Sarandos used this formulation to argue the combined catalog would increase perceived value for many subscribers, while also noting Netflix’s cancelation ease as a market discipline on pricing.
Unconfirmed
- Whether the DOJ will require specific, enforceable price restrictions or other guardrails as part of merger clearance remains undecided and unannounced.
- The company’s 80% overlap figure is a Netflix-provided metric; independent market verification of that precise percentage was not presented at the hearing.
- Any future price increases following a completed merger and their timing, scope or regional application are speculative until formal company announcements or regulatory conditions appear.
Bottom Line
The Netflix–Warner Bros. Discovery transaction presents a mix of potential consumer benefits—broader content libraries and possible scale efficiencies—and real antitrust questions about pricing power and market concentration. Netflix’s public position emphasizes choice and a low-friction cancellation experience as constraints on unilateral price rises, but lawmakers and regulators will weigh market structure, content ownership, and bargaining leverage when assessing the deal.
Practical outcomes will depend on the DOJ’s review and any remedies it seeks. Observers should watch for formal filings, independent market analyses, and specific commitments Netflix makes to preserve affordability; until then, assertions about likely price trajectories remain conditional.
Sources
- Ars Technica — news reporting on the Senate hearing and company statements