Netflix co-CEO Ted Sarandos surprised attendees at Canal+‘s The Original+ showcase in Paris by addressing concerns about the streaming giant’s recent $83 billion acquisition of Warner Bros. Sarandos reassured the French industry that Netflix plans to maintain Warner Bros.’ traditional theatrical distribution model, easing fears within the exhibition sector.
During a conversation with Maxime Saada, chair and CEO of Canal+, Sarandos emphasized Netflix’s commitment to releasing Warner Bros. studio movies in theaters with traditional windows. This marks a significant shift for Netflix, which has previously clashed with theatrical exhibitors over simultaneous or shortened theatrical release windows. Sarandos explained that Netflix’s previous lack of involvement in traditional theatrical distribution was due to not owning the necessary distribution mechanisms.
The acquisition of Warner Bros. Studios will not change the studio’s operations, with movies continuing to be released in cinemas. Sarandos highlighted the importance of cinema viewing experiences to audiences in France and worldwide, affirming Netflix’s support for traditional theatrical distribution.
French exhibitors have expressed concerns about the acquisition’s potential impact on the country’s theatrical ecosystem, prompting calls for antitrust regulators to scrutinize the deal. France’s strict windowing regulations require Netflix to wait 15 months after theatrical releases before offering films on its platform, creating ongoing tensions in the regulatory environment.
Saada acknowledged the evolving partnership between Netflix and Canal+, noting the companies’ mix of collaboration and competition. Sarandos downplayed concerns about competition, emphasizing Netflix’s focus on film and television content over live programming and sports rights. He credited Netflix with expanding France’s paid television market significantly since its arrival.
The Warner Bros. acquisition surprised many, given Netflix’s historical focus on original programming rather than acquisitions. Sarandos explained that the deal fills gaps in Netflix’s library and production capabilities, leveraging Warner Bros.’ extensive experience in areas such as third-party production and theatrical distribution.
Despite the complexities of operating in France’s regulatory environment, Sarandos expressed his affection for the country during the upfronts conversation. He highlighted France’s importance to Netflix, despite the challenges posed by regulations on streaming platforms.
Sarandos also addressed the evolving competition in the streaming landscape, noting the rise of platforms like YouTube, TikTok, and Instagram. He emphasized Netflix’s focus on creating joy and engaging content to compete for audience attention across various screens and platforms. Sarandos highlighted Netflix’s commitment to video games as a response to audience demand for interactive content.
The Warner Bros. acquisition is pending regulatory approval in the U.S. and Europe, with stakeholders calling for careful antitrust scrutiny. If approved, the deal would represent a significant media consolidation and mark a fundamental shift in Netflix’s business model by incorporating traditional theatrical distribution for the first time.
