DOJ asked to investigate Warner Bros. Discovery on potential antitrust violations

Warner Bros Discovery Logo - Featured - Announcement - 01
Warner Bros Discovery

A new report from Deadline states that the Warner Bros. Discovery (WBD) merger is reportedly the target of U.S lawmakers. According to a letter sent to the Attorney General by Sen. Elizabeth Warren (D-CA) and other members of Congress, they intend to “investigate the competitive consequences” and potential antitrust violations as a result of the merger. Antitrust laws themselves exist to protect consumers and businesses from unlawful practices. Although, the acquisition of WarnerMedia by Discovery was initially cleared of antitrust scrutiny.

WBD’s aggressive measures post-merger indicate that current competition in the media and entertainment industry is inadequate. The company has the incentive and ability to eliminate broad
swaths of its workforce, leaving workers with fewer choices for employment and advancement. The
Department should investigate the competitive consequences of this merger.

-Letter from Senator Liz Warren (D-CA), along with Representatives Pramila Jaypal (D-WA), David Cicilline (D-RI, and Julian Castro (D-TX) to Assistant Attorney General Jonathan Kanter. (read here)

The idea to “reassess” the merger comes on the heels of several cancellations and labor concerns since the merger’s approval. This includes the cancellation of the Batgirl (2022) film while it was deep into post-production. Most of the efforts to cut costs lie at the center of things. Following the deal, the lawmakers cite “aggressive measures” and company-wide layoffs to media, entertainment, sales, and journalism departments as incentives to investigate. In particular, the letter highlights the fates of thousands of workers at CNN+ and CNN.

The initial letter from 2021 to Attorney General Kanter did not affect the original review. However, Kanter’s statements likely encouraged them to try again. In their new letter, they allege that “Warner Bros. Discovery has reduced the content available to consumers” and “will likely continue to limit consumer choice without adequate competition.” As for consumers and fans of DC, the result of the second review may yet again disrupt the DCU calendar.

Overall, the sum of their fears seems to be that “WBD’s new ownership is hollowing out an iconic American studio.” At the very least, they believe the future merger of the HBOMax and Discovery+ streaming services could lead to price increases and cancelations, amid “dramatically less available content,” and “discouraging innovation.”

Despite the situation, Warner Bros. Discovery still plans to unveil its new strategy for direct-to-consumer streaming on April 19. As of now, neither Warner Bros. Discovery nor its CEO David Zaslav have yet to comment.