Cinema United, the trade org for exhibition, has made public its remarks about the pending Netflix–Warner Bros merger to the Senate antitrust subcommittee, saying, “If Netflix succeeds in acquiring Warner Bros., the results will be economically and culturally catastrophic: fewer theatres, shorter windows, less revenue, fewer jobs across the national and global entertainment industry, and fewer movies for consumers to see in theatres.”
Cinema United, previously known as National Association of Theatre Owners, submitted a six-page written testimony to the Senate Judiciary Subcommittee on Antitrust, Competition Policy & Consumer Rights on Tuesday.
While Netflix co-CEO Ted Sarandos told lawmakers on the record the streamer is about a 45-day exclusive theatrical window for movies, many rival studio sources have questioned the streaming boss’ intent. If Sarandos is thinking a 45-day window to streaming, that’s still rather destructive to the business. When distributors talk about a 45-day window, they mean 45 days until PVOD or sell-through digital — a window that precedes the streaming window. Streaming windows generally are around 90-100 days or more after a movie bows in cinemas.
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In the statement, Cinema United advocated: “We are deeply concerned that this acquisition of Warner Bros. by Netflix will have a direct and irreversible negative impact on movie theatres around the world. Such an acquisition will further consolidate control over production and distribution of motion pictures in the hands of a single, dominant, global streaming platform in a market that is already highly concentrated. The impact will not only be felt by theatre owners, but by movie fans and surrounding businesses in communities of all sizes.”
The trade group extended its concerns of the proposed Warner Bros. merger beyond Netflix, adding: “If Paramount or another major studio ends up displacing Netflix as the buyer, our concerns are no less serious. A combination of Paramount and Warner Bros., for instance, would consolidate as much as 40% of each year’s domestic box office in the hands of a single dominant studio.”
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“The key to a successful industry overall is having a diverse, robust, and consistent product pipeline that responds to consumer demand. The number of films being produced for theatrical exhibition is slowly returning to pre-2019 levels. However, that growth is threatened by further consolidation. At best, an acquisition of Warner Bros. will stall the growth we have seen in the last four years. More realistically, however, it will result in a significant reduction of theatrical releases,” the Michael O’Leary led cinema org explained.
The statement summed up, “We must heed the lessons of the past: further industry consolidation has consistently led to fewer movies being made, and there is no reason whatsoever to believe the outcome here would be any different, particularly given Netflix’s stated views of movie theatres over the past decade-plus.”
Cinema United reps more than 31,000 movie screens across all 50 states and over 30,000 additional screens in 80 countries worldwide.
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