We live in an age with virtually unlimited choice when it comes to digital streaming, with industry leaders like Netflix, Amazon Prime Video, Disney+, Paramount+, and HBO Max competing for subscribers. Right now, Netflix is in the spotlight because the company is in the process of acquiring Warner Brothers-Discovery (WBD) signature assets – its massive catalog of movies and shows and its film and television studios, including HBO Max and HBO. The deal, if successful, will provide more choice and greater value for a consumer market eager for more content with one click.
The House Judiciary Subcommittee on the Administrative State, Regulatory Reform and Antitrust held a hearing on January 7, 2026, to examine competition among digital streaming services and how antitrust law relates to a consumer-facing industry undergoing changes through mergers and acquisitions. At the hearing, Netflix's proposed acquisition of WBD's assets was front and center.
There were two big takeaways from the hearing. The first, politicians and bureaucrats should not interfere with two companies agreeing to merge to provide better and more efficient streaming for consumers, and second, any antitrust review process should view the entertainment market as highly competitive and dynamic, involving a wide array of broadcast and social platforms in addition to paid streaming services.
During the hearing, Jessica Melugin, Director of the Center for Technology and Innovation at the Competitive Enterprise Institute, made a strong case for regulatory restraint by pointing to a cautionary tale from 2005. Melugin argued that, "what the Wall Street Journal then described as, 'the not-so-gentle prodding of federal antitrust authorities,' the movie-rental chain Blockbuster dropped its bid to purchase its rival, Hollywood Entertainment." Both companies later went bust – a direct result of misguided government interference which prevented them from achieving the scale needed to compete against emerging threats like Netflix and other new services.
Ironically, regulators cited Netflix's mail-order DVD service as proof of sufficient competition, blocking a merger which might have created a viable competitor to the streaming revolution. Instead, government intervention accelerated both video rental companies' demise, leaving consumers with fewer choices. This spectacular regulatory failure demonstrates why politicians and bureaucrats cannot predict market evolution and should not block the Netflix-WBD deal based on today's snapshot of a rapidly changing industry.
Regulatory restraint should always be a default, Melugin argued. "Just as the Federal Trade Commission could not anticipate the technological shifts that have rendered physical DVD rentals nearly obsolete," she said, "antitrust regulators still cannot predict what will come next." Because the market is shifting day-to-day, there is no way politicians and government bureaucrats can foresee how the market in entertainment streaming will advance in the next year, let alone the next few months. Market dynamism and economies of scale can greatly help consumers get what they want.
The entertainment landscape continues to evolve at breakneck speed. Streaming services now compete not just with each other but with gaming platforms, user-generated content, and emerging technologies like virtual reality experiences. Regulatory decisions made today based on yesterday's market conditions risk stifling innovation and preventing companies from achieving the scale necessary to invest in premium content consumers demand.
Lawmakers and witnesses at the hearing repeatedly emphasized that the entertainment marketplace extends far beyond paid streaming. As Melugin noted, "Social media's vast and 'free to the company' content may well constitute a sufficient competitive threat to streaming services." She argued that platforms like YouTube and TikTok are not just entertainment options, but direct competitors for consumer attention – forcing traditional streaming services to innovate and expand their offerings. It is vital that regulators take this into account when evaluating a Netflix-WBD merger.
Competition is not limited to a handful of streaming giants but is shaped by a broad and rapidly evolving array of digital and social platforms. Even the Oscars will soon be hosted on YouTube.
This expanded competitive landscape strengthens the case for the Netflix-WBD merger. When consumers can access thousands of hours of free content on YouTube, watch live sports, like the NFL, on social platforms, and engage with creator-driven programming on TikTok, the notion that combining two paid streaming services creates monopolistic power becomes increasingly difficult to defend. The real competition is for consumer attention across all digital platforms, not just within the narrow category of subscription streaming.
The Netflix/WBD deal would still leave Paramount and all the other major streaming services to compete. Anybody with a smart TV, iPhone, or computer can log on today and find the streaming service of their choice, not just Netflix with an enhanced catalog of WBD content.
The bottom line is that this deal does not create anything resembling a monopoly nor impinge on a vibrant competitive market in streaming. Congress and antitrust regulators should step aside and let the market work to the benefit of consumers. Let consumers, not politicians, make their own decisions with their own money.
Blocking this deal would protect no one while potentially depriving consumers of the innovation and value that vertical integration can deliver.
