Hollywood is on edge as Netflix’s potential $83 billion acquisition of Warner Bros looms. If it goes through, many fear more job losses and cut-backs in the industry. Powerful unions and notable figures, like actress Jane Fonda, are urging regulators to step in. Fonda claims the deal poses a serious threat to the entire entertainment sector.
The concerns are real. “Lay-offs and the future of movie releases are two primary worries,” says Stephen Galloway from Chapman University. Netflix won the bid, edging out competitors like Paramount and Comcast. This follows the recent $8 billion purchase of Paramount by Skydance, highlighting the significant shifts brought on by streaming services.
With big tech pushing deeper into Hollywood—think Amazon’s MGM acquisition in 2022 or Apple’s foray into streaming—traditional studios are feeling the heat. Netflix has its roots in Silicon Valley, while the financial backing for Paramount can be traced to tech mogul Larry Ellison. Amid this change, YouTube influencers are establishing studios in Los Angeles, creating yet another ripple in the market.
Industry insiders worry that fewer buyers for films and TV shows could stifle creativity and opportunities. Galloway points out that a limited number of major buyers can lead to a severe income slump for Hollywood workers.
The landscape has shifted significantly since the streaming bubble burst in 2022, a crisis worsened by the writer and actor strikes that halted production and stalled releases. This downturn has led Hollywood to shed tens of thousands of jobs since 2020. Many have departed Los Angeles in search of new opportunities, affecting not just the film industry but also local businesses, from restaurants to florists.
On a brighter note, Netflix co-CEO Greg Peters suggests that this acquisition could boost production in the U.S. and create new jobs in the industry. He insists there is no intent to move away from theatrical releases, assuring that Warner Bros will continue to distribute movies in cinemas.
Despite the uncertainty, Warner Bros chief David Zaslav believes the fears about job cuts are overblown. “Most people will be kept on,” he assured employees, emphasizing that Netflix doesn’t have a vast number of employees to begin with.
Interestingly, some view Netflix as a stabilizing force for Warner Bros. Tom Nunan, an Oscar-winning producer, believes Netflix’s innovative edge could enhance Warner’s ability to stay relevant in the ever-changing industry landscape. “If Warner is going to sell, it might as well be to the smartest player,” he argues.
The path ahead for Hollywood is unclear, but the waves of change brought in by Netflix and tech will continue to reshape the industry. As always, it seems, adaptation will be key for survival.
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