HBO Max subscriber sues Netflix to halt merger

Let the ineligible conflict begin.

On Monday, a Las Vegas-based HBO Max subscriber sued Netflix implicit concerns that the streamer’s plans to bargain immoderate of Warner Bros. Discovery’s assets would make an anti-competitive situation successful the amusement manufacture and rise subscription prices.

Netflix said past week it agreed to bargain Warner Bros. Discovery’s movie and TV business, its Burbank lot, HBO and the HBO Max streaming work for $27.75 a stock oregon $72 billion. It besides agreed to instrumentality connected much than $10 cardinal of Warner Bros.’ debt, creating a woody worth of $82.7 billion.

Michelle Fendelander alleges successful her suit that if Netflix’s woody were to spell through, it would alteration contention successful the subscription streaming market. She is asking the tribunal to contented an injunction to forestall the merger from happening oregon contented a remedy for the anti-competitive effects.

“American consumers — including SVOD purchasers similar Plaintiff, an HBO Max subscriber — volition carnivore the brunt of this decreased competition, paying accrued prices and receiving degraded and diminished services for their money,” according to Fendelander’s lawsuit, which is seeking class-action status. The suit was filed successful a U.S. District Court successful San Jose.

Netflix connected Tuesday called the suit “meritless” and “merely an effort by the plaintiffs barroom to leverage each the attraction connected the deal.”

The Los Gatos, Calif.,-based streamer is agelong seen arsenic the victor of the subscription streaming wars, boosted by having successfully entered the streaming contented abstraction earlier than rivals and for its superior proposal technology. By buying Warner Bros. Discovery’s assets, Netflix would summation entree to much franchises and characters, including Batman, “Game of Thrones” and Harry Potter. Netflix said it plans to support Warner Bros.’ commitments to bringing its movies to theaters.

But Fendelander and immoderate manufacture observers are acrophobic that Netflix owning 1 of its streaming rivals volition wounded the amusement manufacture due to the fact that it means little competition.

“The elimination of this rivalry is apt to trim wide contented output, diminish the diverseness and prime of disposable content, and constrictive the spectrum of originative voices appearing connected large streaming platforms,” according to the suit by Fendelander, who has ne'er been a Netflix subscriber.

Streamers implicit the years person steadily raised their prices, and immoderate analysts said they would not beryllium amazed if subscription prices continued to spell up.

Netflix executives said they judge their woody to get WBD’s assets volition payment cardinal stakeholders.

“It’s going to mean much options for consumers,” said Netflix Co-CEO Greg Peters connected a telephone with investors past Friday. “It’s going to beryllium much opportunities for creators, much worth for our shareholders. Together, we’ve got the accidental to bring large stories, cutting borderline innovation and much prime to audiences everywhere.”

Peters besides pointed retired astatine a UBS league connected Monday that Netflix combined with the assets it is acquiring from Warner Bros. Discovery would inactive magnitude to a smaller stock of U.S. TV viewing than YouTube.

Whether the woody volition get implicit the decorativeness enactment remains to beryllium seen, though Netflix executives accidental they judge it will. On Monday, Paramount said it would straight entreaty to shareholders to connection an alternate bid.