During a recent appearance before the Senate Judiciary Committee’s subcommittee on antitrust, competition policy, and consumer rights, Netflix co-CEO Ted Sarandos addressed concerns regarding the company’s proposed acquisition of Warner Bros., including HBO and HBO Max. Sarandos steadfastly rejected claims that the $72 billion deal, which the company later amended to be paid entirely in cash, would lead to an undue concentration of power within the streaming industry. This assurance comes as Netflix prepares to integrate a vast library of content, including popular franchises like Harry Potter and The Big Bang Theory, into its offerings.
Senator Amy Klobuchar, a Democrat from Minnesota, pressed Sarandos on the potential for price hikes should the merger proceed. She highlighted Netflix’s past increases, noting that the company raised its lowest-tier ad-supported plan by $1 per month last year, while its standard and premium ad-free plans saw increases of $2.50 and $2, respectively. Klobuchar expressed apprehension that acquiring HBO Max, currently the third most popular streaming service in the U.S. by subscriber count, could incentivize Netflix to further elevate its subscription costs post-merger.
Sarandos countered this perspective by asserting that any price adjustments by Netflix have always been commensurate with an increase in subscriber value. He explained that the company views its pricing strategy as directly tied to the expanded content and improved experience it provides. Sarandos further emphasized that Netflix’s prices have, in his view, risen at a slower rate compared to some competing services. He also presented a metric suggesting that Netflix subscribers, on average, pay approximately 35 cents per hour for the content they consume on the platform.
A central point of Sarandos’s argument rested on the ease with which subscribers can terminate their service. He underscored the “one-click cancel” option, portraying it as a fundamental safeguard for consumers. This feature, he contended, ensures that if subscribers ever feel the value proposition diminishes, they are not locked into an unwanted subscription. A Netflix spokesperson later confirmed the availability of this one-click cancellation functionality.
The proposed acquisition, first announced in December, is set to integrate Warner Bros.’ extensive film and television catalog into Netflix’s platform. Notably, cable channels such as CNN, TNT, and HGTV are not part of this deal; they are slated to be spun off through the separation of Discovery Global’s Global Linear Networks business, a process expected to conclude by the third quarter of 2026. Netflix leadership believes this deal will significantly accelerate its business growth by enriching its content library and, according to Sarandos, will also foster job creation within the American production sector by expanding both Warner Bros. and Netflix’s domestic output.
Despite the strategic rationale presented by Netflix, the company’s stock has experienced a roughly 19% decline since the merger announcement. Industry analysts, such as Barton Crockett of Rosenblatt Securities, have noted that even if the deal ultimately closes, Netflix could face a period marked by uncertainty, various risks, and potentially a modest return on its substantial investment. Nevertheless, Sarandos remains optimistic about the company’s ability to continue delivering content that resonates with its audience, stating, subscribers “have to really love what they’re watching and thank goodness we’re doing a good job of that.”
