Netflix co-CEO Ted Sarandos spent his Tuesday trying to convince a room full of skeptical senators that buying Warner Bros. Discovery’s streaming business wouldn’t turn his company into some unstoppable streaming giant. His main argument? Most HBO Max subscribers already pay for Netflix, so what’s the big deal?
The Senate hearing focused on Netflix’s proposed acquisition of WBD’s streaming and film studio assets, a deal worth $82.7 billion that has regulators understandably nervous. With Netflix sitting at 301.63 million subscribers and HBO Max adding another 128 million to the pile, you can see why antitrust lawyers are sharpening their pencils.
The Overlap Argument
Sarandos leaned hard on the 80 percent overlap statistic. His pitch basically boiled down to this: these services are “complementary” because their subscriber bases already intersect so much. It’s an interesting defense, though it conveniently ignores what happens to the 20 percent who only subscribe to HBO Max or what this means for the Business landscape when one player controls that much content.
Senator Amy Klobuchar wasn’t buying it. She pressed Sarandos on pricing, especially since Netflix just raised prices in January 2025 despite adding subscribers. The timing couldn’t look worse for Netflix’s “trust us” messaging.
Sarandos fell back on the classic streaming defense: you can cancel with one click. Sure, technically true. But when you’re potentially creating a streaming behemoth that controls everything from “Stranger Things” to “Game of Thrones” reruns, the one-click cancel button feels less like consumer protection and more like a PR talking point.
The Value Per Hour Math
The Netflix executive brought receipts to the hearing, claiming Netflix subscribers pay about 35 cents per hour of content watched compared to 90 cents for Paramount+ users. It’s a clever way to reframe the pricing debate. Instead of talking about monthly subscription costs, shift the conversation to value per viewing hour.
But this metric only matters if you’re actually watching. Quality matters more than quantity to most people, and bundling HBO’s prestige content with Netflix’s volume play doesn’t automatically create better Technology or better entertainment value for subscribers.
YouTube As The Real Threat
Sarandos tried to paint YouTube as the actual streaming king, pointing to Nielsen data showing YouTube with 12.7 percent of TV viewership compared to Netflix’s 9 percent. Even after absorbing HBO Max, Netflix would only hit 21 percent of the SVOD market, he claimed.
This argument feels a bit disingenuous. YouTube operates on a completely different model with free, ad-supported content. Comparing subscription streaming services to YouTube is like comparing apples to a fruit salad that also happens to contain apples.
The Netflix co-CEO also name-dropped Google, Apple, and Amazon as “deep-pocketed tech companies trying to run away with the TV business.” It’s a smart deflection tactic. Point at the even bigger fish and hope senators forget you’re trying to become a pretty massive fish yourself.
The Price Hike Problem
When senators pushed on future pricing, Sarandos got vague. He mentioned working with the Department of Justice on “potential guardrails” against price hikes but didn’t elaborate. That’s not exactly reassuring when you’re asking regulators to approve a deal that would reduce competition in the streaming market.
Netflix’s history doesn’t inspire confidence either. The company has steadily raised prices over the years, and the January 2025 increase came right before this acquisition push. The optics are terrible. “Give us less competition and we promise not to raise prices” is a tough sell when you just raised prices.
The Hostile Takeover Subplot
Meanwhile, Paramount Skydance is trying its own hostile takeover of WBD, offering $108.4 billion for the whole company including cable channels. They’ve even sued WBD over the Netflix deal. This isn’t just a regulatory battle anymore. It’s turning into a full-blown corporate drama.
Netflix recently amended its offer to all-cash at $27.75 per share for just the streaming service and film studios. Paramount wants everything at $30 per share. The difference in approach tells you a lot about each company’s strategy and what they think regulators might actually approve.
The streaming wars were supposed to give consumers more choice, but we’re watching the industry consolidate in real time while executives promise this consolidation will somehow benefit the people paying the monthly bills.
