Anonymous A-Listers Lobby Congress Against Netflix-WBD Acquisition: Streamer Would ‘Hold a Noose Around the Theatrical Marketplace’ (EXCLUSIVE)

A consortium of top industry players have sent an open letter full of alarm to Congress, describing a potential economic and institutional meltdown in Hollywood if Netflix succeeds in its effort to acquire Warner Bros. Discovery.

The letter was sent via email to members of Congress from both parties on Thursday from an anonymous collective identifying themselves only as “concerned feature film producers.” The group explained it was leaving the letter unsigned “not out of cowardice” but fear of retaliation given Netflix’s considerable market power as a buyer and distributor. Netflix and Warner Bros. Discovery declined to comment.

One well-placed source confirmed to Variety that the group includes a number of prominent filmmakers.

The communication outlines three areas of great concern, including that Netflix could stand to “destroy” the theatrical film marketplace” by escalating or eliminating the amount of time Warner Bros. films would play in theaters before hitting a combined Netflix-HBO Max streaming platform. Sources told Variety earlier on Thursday that Netflix’s current proposal for Warner Bros. would have a theatrical window as thin as two weeks of exclusivity before debuting on streaming. Another insider familiar with the deal process flatly denied this, saying the periods would be longer. Rival bidders Comcast and Paramount both have robust theatrical distribution outlets. Paramount has specifically pledged to keep Warner Bros. operating as a standalone business that will make a minimum of 14 films for theaters per year.

The producers argued that Netflix would “effectively hold a noose around the theatrical marketplace,” with what they assert would be enough market power to reduce the footprint of theatrical movies and force down subsequent licensing fees paid in post-theatrical windows.

The letter to Congress also references the many times Ted Sarandos, co-CEO of Netflix, has extolled that Netflix’s business model has nothing to do with movie theaters (including a quote from a 2023 earnings call, where Sarandos said, “Driving folks to a theater is just not our business”).

The note concludes by urging members of the House and Senate to speak out publicly against the acquisition and afford the potential deal “the highest level of antitrust scrutiny.” The stakes, the letter concludes, represent millions of jobs and a treasured art form.

More to come …