In a nail-biting bidding race for Warner Bros, it looks like the world’s biggest streamer has come out on top.

The industry woke up this morning to the news that Netflix has entered into a definitive agreement to buy the Hollywood giant’s film and streaming business—namely, its movie and TV studios, plus HBO Max and HBO.

This US$82.7-billion deal is pending regulatory approvals and should close in 12 to 18 months, after David Zaslav splits off of the company’s global networks division into a separate company in Q3 2026. Netflix beat out high-profile competitors Paramount and Comcast to win the day, though the former is alleging “a tilted and unfair process” that favored the streamer’s bid.

In an official announcement, WB and Netflix positioned the deal as advantageous across the board. For the industry, Netflix says the takeover will offer it more opportunities to work with beloved IPs, expand stateside production capacity, grow its original content investment and create more jobs. And for consumers, it means a whole lot more options if HBO and HBO Max programming are joining the streaming giant’s already massive library. 

In a marriage of legacy power and streaming prowess, the idea of characters like Bugs Bunny and Harry Potter living under the same roof as KPop Demon Hunters and Stranger Things is quite the change. But questions remain for what this type of consolidation means for the overall health of the kids entertainment space.

“This is bad for the kids TV business,” says media consultant and Netflix whisperer Emily Horgan. “Netflix lost all appetite for developing their own original kids shows after the great crunch of 2022, pivoting to established IPs backed by other studios or doing deals with creators from YouTube.” Horgan notes that Warner Bros. has also stepped away domestically from their valuable kids assets, Cartoon Network and Looney Tunes. “I don’t see this coming back on the priority list in a merger. That leaves Disney, which has some opportunity here to take up space as the safe, quality-assured premium streamer developing original kids TV franchises.” 

“At the back of it all is YouTube, the top platform for the kids audience—but as I wrote recently for Kidscreen, there’s a real question about how the next kids YouTube IP will manage to rise, given monetization for “made for kids” channels is so challenging.”

Ampere Analysis executive director Guy Bisson tells Kidscreen that he expected Netflix to ultimately win the bidding war after the streamer said IPs were a key reason why Netflix wanted to buy Warner Bros. “While Netflix has made in-roads building its own library of returnable IP, such as Gabby’s Dollhouse and the Roald Dahl universe, this is an area that takes years to build, and Netflix has potentially found an effective shortcut. It’s also well known that HBO content that has been licensed to Netflix does really well there.” 

Bisson says getting the keys to a huge legacy studio’s operations will be a shift for Netflix, given its longtime status as a disruptor in the business—one that “ultimately has driven Hollywood and the whole legacy business to the challenging position it now finds itself in”. “This isn’t a case of the upstart growing up and becoming the old man, because Netflix will surely still now shake up the whole traditional value chain, from the cinema onwards,” says Bisson. “But it does show the power of the vertically integrated studio model of content plus distribution—a model Netflix has been slowly building within its existing operations.” 

On that note, one of the biggest concerns around Netflix acquiring WB’s film business is the streamer’s well-known reluctance to embrace theatrical releases—though it has been gradually making more exception, as seen with the limited releases of KPop Demon Hunters and the newest season of Stranger Things. For its part, Netflix said today that it “expects to maintain Warner Bros.’ current operations and build on its strengths, including theatrical releases for films.” 

European Cinema trade body UNIC is among the industry voices that have come out strongly opposed to the proposed deal this morning. “Both in its words and actions, Netflix has time and again made it clear that it doesn’t believe in cinemas and their business model,” said UNIC CEO Laura Houlgatte in a statement. “Netflix has released only a handful of titles in cinemas, usually to chase awards, and only for a very short period, denying cinema operators a fair window of exclusivity.”

Entertainment lawyer Simon Pulman says the big question is whether this deal could have a “chilling impact” on Netflix’s spending on original concepts, when there are WB and DC assets to prioritize. “Obviously for independent producers and smaller production companies, this means one less buyer and even less leverage when pitching projects.” 

And Pulman wondered whether kids & family titles that got the axe from HBO Max in recent years could return. “A question mark may go to those offerings that were removed, [including] Looney Tunes and many Cartoon Network series. Will they find their way onto Netflix post-merger?” Either way, the streamer will likely have to strategize smart ways to bring in a massive catalogue of WB titles. “Will they get their own subcategories within Netflix? If not, the already existing discovery challenge for catalogue content on Netflix is likely to be exacerbated.”