Netflix's Big Bet on AI Movies: Why Buying Warner Bros Could Rewrite Cinema Forever

Netflix has executed a staggering move in Hollywood, spending £72 billion ($82.7 billion) to acquire Warner Bros, HBO, and HBO Max.

While the deal immediately strengthens its streaming empire, the underlying strategy is even bolder: Netflix is betting on artificial intelligence to reshape filmmaking and control the world's most iconic entertainment properties.

The Bidding War That Shook Hollywood

Paramount initially appeared poised to win Warner Bros, backed by billionaire David Ellison, who offered an all-cash £26 per share deal supported by Middle Eastern sovereign wealth funds.

Netflix countered with a slightly lower offer of £24.10 ($27.75) per share but added an eye-watering £5.05 billion ($5.8 billion) breakup fee.

No competitor had ever dared such a wager. Netflix was signalling confidence in navigating regulatory scrutiny and securing the deal despite obstacles.

Paramount's lawyers accused Warner Bros CEO David Zaslav of personal bias and corruption, claiming he wanted a post-deal role at Netflix.

Despite the allegations, Netflix patiently held its ground, ultimately securing the deal and reshaping power dynamics in Hollywood.

The Real Prize Is Intellectual Property

While streaming access was a factor, the true value lies in Warner Bros' intellectual property. The company owns Batman, Superman, Wonder Woman, Harry Potter, Game of Thrones, The Sopranos, Friends, The Big Bang Theory, and hundreds of other iconic titles.

By controlling these franchises, Netflix can leverage AI to produce near-limitless spin-offs, reimaginings, and sequels at minimal production cost.

Paramount had sought the entire Warner Bros Discovery, including CNN, TNT, and other cable channels, which Netflix deliberately avoided. Instead, the streaming giant focused solely on high-value studio and streaming assets.

Analysts from Bank of America described the acquisition as a move that 'achieves multiple objectives': it removes a competitor, merges HBO Max into Netflix, and positions the platform as the pre-eminent source of content for AI innovation.

Hollywood's Pushback

The deal drew swift criticism from industry veterans. Director James Cameron called the acquisition a 'disaster,' while anonymous Hollywood producers lobbied US Congress, warning that Netflix's dominance could choke theatrical cinema.

Unions and theatre owners expressed concern over potential job losses and reduced theatrical releases, fearing Netflix would prioritise AI-generated content over live-action productions.

Despite the backlash, Netflix appears undeterred. Its short-term goal is clear: consolidate content, control the IP, and prepare for AI-powered filmmaking.

By 2028, the company plans to release AI-generated movies, and by 2029, it could produce new Batman and Harry Potter content entirely through AI, bypassing traditional production costs and schedules.

Public Opinion and the AI Future

Reactions online are mixed. Critics argue: 'If they think people are going to pay good money to watch AI slop they are sadly mistaken.' Supporters highlight the strategic advantage: 'Netflix now owns one of the deepest libraries on earth.

In the AI future, the moat shifts from production spending to owning the canonical versions of the most beloved characters.'

With over 260 million subscribers, the second-largest content library in the world, and the prestige of HBO and Warner Bros theatrical distribution, Netflix is betting heavily that AI will define the next era of cinema.

While traditionalists question the artistic and ethical implications, Netflix is positioning itself as the central hub for all future blockbuster content.

The coming years will determine whether this monumental gamble cements its dominance or risks alienating audiences who still value human storytelling.