Neil Fryman

Co-CEO Ted Sarandos acknowledged the deal was a departure from the company that has typically built things internally instead of buying them from the outside.

I know some of you are surprised we are making this acquisition, he told analysts on Friday, but this is a rare opportunity that will help us achieve our mission to entertain the world.

He's right about one thing.

This is going to be entertaining because the merger announcement is just the start of what could be years of drama.

Already, Hollywood labor groups and some politicians have come out against the deal, saying it would give Netflix an illegal monopoly over the entertainment industry.

Plus, the companies that Netflix beat out to buy WBD probably aren't going to sit still.

Paramount, whose all-cash offer for WBD was passed over by the board, could launch a hostile bid, taking its pitch directly to shareholders with a price above Netflix's.

But let's start here, Toby.

There doesn't seem to be anyone outside of Netflix and WBD that is happy about this deal.

Yeah.

So Netflix co-CEO Ted Sarandos has talked about the business model of theatrical releases and in the past quite a bit.

And he said they are, quote, outmoded.

He is not a huge fan.

And then go to after the merger announcement that that was all the questions he was being asked.

So what are you going to do after you acquire the Warner Brothers movie studio?

Are you still going to have them do theatrical releases?

And he said right now you should count on everything that is planned on going to the theater through Warner Brothers.

So he's sticking to that business model.

But a lot of people focused on those two words at the beginning of that quote right now.

And who knows what's going to happen in the future should this acquisition get closed.