Apple’s efforts to acquire Warner Bros. Discovery to greatly bolster Apple TV have ended in disappointment, with Netflix emerging victorious in what became one of Hollywood’s most competitive bidding wars in recent years.
Netflix said Friday it will purchase Warner Bros. Discovery’s entertainment assets for $72 billion, outbidding Apple and other tech giants to secure one of the industry’s most valuable content libraries. The deal, far larger than any Netflix (or Apple, for that matter) has attempted to date, includes Warner Bros. studios, HBO and the HBO Max streaming service. Those assets would have dramatically transformed Apple TV’s positioning in the streaming wars.
Apple’s missed opportunity: Netflix buys Warner Bros.
For Apple, the loss represents a significant setback in its streaming ambitions. The company had reportedly been in serious discussions to acquire Warner Bros. Discovery after CEO David Zaslav approached multiple suitors in October, including Apple, Amazon, Comcast and Netflix. Market research shows that 21% of HBO subscribers already pay for Apple TV suggested strong potential synergy between the two services.
The acquisition would have marked a major strategic shift for Apple TV. It has maintained a build-rather-than-buy approach focused on original content. Adding Warner Bros. Discovery’s extensive catalog — including HBO prestige series like Game of Thrones, The White Lotus and the Harry Potter and DC Comics franchises — would have instantly elevated Apple TV from a niche player to a major streaming powerhouse.
Netflix’s winning bid
Netflix’s per-share offer of $23.25 in cash and $4.50 in stock values Warner Bros. Discovery at $72 billion, significantly above its $60 billion market capitalization before the announcement. The streaming giant also sweetened its proposal with a $5.8 billion breakup fee and commitments to continue releasing Warner Bros. films in theaters rather than just on Netflix — a key concern for the studio.
“Together, we can give audiences more of what they love and help define the next century of storytelling,” Netflix co-CEO Ted Sarandos said in a statement.
The victory is somewhat surprising given Netflix’s historical preference for building content in-house rather than acquiring established studios. The company has never completed an acquisition of this magnitude, making the Warner Bros. Discovery deal a dramatic departure from its traditional strategy.
Regulatory hurdles ahead
The transaction faces significant regulatory scrutiny and won’t close until after Warner Bros. Discovery completes a planned spinoff of its cable networks — including CNN and Food Network — into a separate publicly traded company called Discovery Global. That spinoff isn’t expected until the third quarter of 2026, meaning the deal won’t be finalized for some time.
Paramount, which made two unsuccessful $24-per-share bids for Warner Bros. Discovery earlier in the process, has already raised objections. In a letter to Warner Bros. Discovery, Paramount’s lawyers accused the company of unfairly favoring Netflix and argued the deal would “entrench and extend Netflix’s global dominance in a manner not allowed by domestic or foreign competition laws.”
The regulatory outcome will largely depend on how authorities define the relevant market. A narrow definition focused on subscription streaming could lead to the deal being blocked, while a broader definition encompassing all video entertainment platforms might allow it to proceed.
Netflix buys Warner Bros: What’s next for Apple TV
Apple’s failure to secure Warner Bros. Discovery leaves questions about the company’s streaming strategy going forward. Apple services chief Eddy Cue recently stated on The Town podcast that Apple generally prefers building to buying, saying “we’re not actively looking at buying any company of any size.”
However, Cue added he “never says no to anything.” That leaves the door open for future acquisitions if the right opportunity emerges.
For now, Apple TV will probably continue relying on its original content strategy. But the loss of Warner Bros. Discovery to a key competitor makes that path considerably more challenging as the streaming landscape grows increasingly consolidated.
David Snow, an expert on Apple hardware and software, writes on a variety of technological and cultural topics for Cult of Mac. They include Apple news, technology buying guides, and features about computer setups and Apple TV shows and movies.
With 30 years of experience covering technology and other subjects, he has written and edited for numerous print and online publications, including CMP Media, TechTV.com, CNET, Wired News, Red Herring magazine, Law.com, The National Law Journal and Law Technology News magazine. Among other roles, he served as executive editor of the Law.com network of websites and editorial director, technology, for ALM Media.
Snow graduated with a B.A. from Syracuse University with majors in magazine journalism and psychology. While there, he worked as a reporter for The Daily Orange newspaper and associate editor of Equal Time magazine.
Founder of the blog At the Waterline, he can be reached on X (formerly Twitter) via @atthewaterline and on Mastodon via @dsnow.
