Why Netflix Needs Warner Bros.

Prior to its $83 billion deal to acquire the studio and HBO Max, the streamer had never spent more than $700 million on an acquisition. But Netflix saw an opportunity to own, not license, a significant chunk of its content—and, perhaps more importantly, to block David Ellison from taking it away.

Netflix needs Warners more than most people care to think: After all, roughly half of its business is dependent on partners whose own objectives might change. Photo: Lisa Lake/Getty Images for Netflix

Julia Alexander

December 12, 2025

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For the longest time, Netflix co-C.E.O. Ted Sarandos could walk into his office off Sunset Boulevard secure in the knowledge that a relatively simple strategy would keep the world’s largest streamer in first place: pairing high-quality original titles with an endless scroll of algorithmically optimized licensed content. That playbook, more or less, has made Netflix the envy of the industry and more than satisfied users despite price hikes and password-sharing crackdowns. And everyone in town knew it—which is why it was such a shocker when the company, which had never before spent more than $700 million on an acquisition, suddenly bid $83 billion for the non-cable assets of Warner Bros. Discovery.