Netflix beats Universal for Warner Bros. prize - for now
The dream is dead. Long live the dream?
Netflix has agreed to buy Warner Bros.' studio and HBO in a gajillion dollar (okay $82 billion) deal. That ends hopes that rival Comcast - the owner of NBCUniversal - would get WB, giving Universal more control of several prized theme park IPs.
Netflix is inching its way into the location based entertainment business with its two Netflix House openings in Philadelphia and Dallas. But it's just speculation at this point to say anything about what Netflix might do in theme park business with the WB assets that it is trying to acquire.
The deal would not close until the third quarter of next year, after Warner Bros. Discovery spins off most of its linear cable networks, including CNN, TBS, TNT, and Discovery Channel. And the deal must survive any potential opposition from the U.S. government. The current administration is hardly one to enforce antitrust regulations, but it also was all but openly rooting for Paramount Skydance to buy the whole of WBD, mostly so that MAGA-friendly Paramount could control CNN. Perhaps Paramount Skydance might still get that cable net from WBD in the fire sale later next year, but that ain't a theme park thing, so I'll leave it at that.
Meanwhile, Bloomberg is reporting that WBD is talking with theme park operators, citing Universal specifically, to license its IP for their attractions. Six Flags holds those rights in much of the United States, Canada, and Mexico, but that license carves out Las Vegas and Florida. That opens the door for Disney, Universal, or United Parks to buy a license for WBD properties - including DC Comics and Looney Tunes - for their Florida properties.
Universal getting a DC license raises questions about the future of its license for Disney's Marvel characters. I have heard that the contract with Marvel prohibits Universal from signing DC, given the latest memo of understanding with Disney. (Remember that DC was the original concept for what became Marvel Super Hero Island, before Warner Bros. declined to license the characters.) However, the new availability of DC characters might make Universal much more willing to cash the very large check that Disney has offered to buy out that Marvel license.
Licensing characters is not the same as owning them, of course. Part of the reason why I was rooting for Comcast in the Warner Bros. sweepstakes was to have Universal take full control of the Looney Tunes franchise, which current WB management has pretty much ignored.
A license that is limited to Florida also is not as valuable to Universal as one that would allow it to bring Warner Bros. characters to its parks in California and Texas. I also don't know that Universal would reap the full value of building an immersive new DC-themed Superman or Batman attraction in Florida if the Superman and Batman brands in the theme park space were being diluted by the presence of so many poorly or unthemed attractions with those brands at various Six Flags parks.
But if that messiness results in WBD offering Universal a cheaper price for a license, the math might still work in Universal's favor. Beyond that, if all that comes from this is Universal getting a license to use WB IP for Universal Horror Unleashed in Las Vegas, that's a potential win right there.
Finally, thank you to Russell Meyer for posting the Netflix news on the Discussion Forum first thing this morning. You can jump into that discussion over there.
Replies (12)
DC and Looney Tunes aren’t anywhere near as important to the Universal Parks as the Harry Potter franchise. How would Netflix ownership effect that relationship?
Random thoughts:
1. Predictions: Paramount Skydance will end up buying CNN. The Allen Media Group (Byron Allen's company) will buy up all or many of the remaining cable networks. (Allen is very bullish on the future of cable.)
2. I don't think Disney would pay for a license to use DC Comics or Looney Tunes in their parks. If they really wanted those IPs, they would buy them outright.
I don't think this will affect the theme park business, there doesn't seem to be much of an incentive for Netflix to mess with the long time Six Flags license. I guess its possible that Netflix would want to make a big 3 instead of a big 2 in terms of Hollywood Studios that also have theme parks, but considering the long history of big corporations trying to do this in the seasonal theme park business (Marriott, Bally's, Time Warner, Paramount) I don't think Netflix will buy Six Flags. It just wouldn't be lucrative for them. Also I can't see Netflix wanting to build megaresorts in a place like Orlando because at this point the market is oversaturated with that. So my prediction in regards to parks is the continuation of the status quo, they will continue to cash checks from Six Flags and Universal.
Looney Tunes Lagoon could still be a possibility. . . maybe. . .
I think universal is going to be busy enough with the UK regulators (it’s Sky subsidiary (uks largest Pay TV operator) is trying to buy ITV’s networks (largest commercial network)
It’s not over folks - Paramount has gone hostile and is offering $30 a share for the whole warners business, including the networks.
Chad, and with DJT behind them and his son-in-law one of the partners tyring to secure the deal Paramount will "trump" Netflix.
Trump has influence on antitrust, but he can’t make the shareholders vote for it.
If Paramount are successful and with the array of prestigious IPs available it is a tantalising thought that maybe one day Paramount will open their own theme park in Orlando. Remember Eisner and Paramount potentially partnering with Universal in the 80s and the defunct concept of Paramount London Resort in Kent, England which was finally withdrawn in 2022?
I dunno about that. Paramount have been in the parks business before…
If the Ellisons win out and want to get into the destination theme park game, United Parks may make sense as WB Parasky's next acquisition.
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Not the worst outcome for Kabletown, especially if they can close the deal for WB IP rights. I don’t see Netflix getting into the destination theme park market, which may not have been the case with Paramount if David “Thanks Dad!” Ellison came out on top in the bidding war.
One thing I do know is that the Mouse’s purchase of Fox looks a lot better today at a price of closer to 44.3B (71.3B less the sales of 39% of Sky, 30% of Tata Sky, 50% of Endemol Shine, and 100% of the RSNs)