Benzinga·2026-01-23 16:51Core Insights - Netflix Inc. is acquiring Warner Bros. Discovery Inc. for $82.7 billion in an all-cash deal, marking a significant departure from its previous strategy of building rather than buying [1] Competitive Landscape - YouTube is identified as Netflix's primary competitive threat, with co-CEO Greg Peters highlighting its substantial viewership and effective business model [2][3] - The competition is viewed in terms of time and attention, with YouTube's dominance in viewership influencing Netflix's acquisition strategy [3] Acquisition Rationale - The acquisition is driven by three main value drivers: theatrical distribution capabilities, enhanced production infrastructure, and the premium positioning of the HBO brand [4] - Peters noted that Warner Bros.' content library is currently underexploited, and Netflix's global reach could significantly increase viewership [4] Deal Structure - Netflix switched to an all-cash offer of $27.75 per share, replacing a previous mixed offer of $23.25 in cash plus $4.50 in Netflix stock [5] Regulatory Perspective - Peters argues that the deal should be considered a vertical integration due to its theatrical and production aspects, with HBO's subscriber base largely overlapping with Netflix's [6] Broader Competitive Framing - The competitive landscape is framed broadly, with YouTube expanding its content offerings, including NFL games and major events like the Oscars, as well as partnerships with UK broadcasters [7]