The global entertainment landscape is poised for a seismic shift, sending shockwaves through the already beleaguered cinema industry. Streaming titan Netflix has announced a staggering $82.7 billion agreement to acquire Hollywood studio Warner Bros. Discovery, a move that has UK and international theatre owners fearing for their future.
A Looming Threat for Theatrical Releases
According to a Wall Street Journal report, the potential merger has left exhibition executives deeply concerned. The core fear is that the deal will accelerate the trend of shorter exclusive theatrical windows, where films are shown only in cinemas before moving to streaming platforms. Netflix, as one of the original streaming services, has a history of either bypassing cinemas entirely or releasing films for just a few weeks before adding them to its digital library.
Michael O’Leary, CEO of the theatrical exhibition trade group Cinema United, highlighted the risk to production, telling the Journal, “When legacy studios are absorbed there’s a significant decline in production.” This could mean fewer major films are made with a traditional cinema-first approach.
An Industry on Shaky Ground
Cinemas were already fighting an uphill battle before this news. Attendance has plummeted in the wake of the streaming revolution and the COVID-19 pandemic, which forced many venues to close permanently. Data reveals the stark decline: in the U.S. and Canada, ticket sales crashed from 1.2 billion in 2019 to just 441 million in 2021.
While the rate of closures has slowed, recovery is fragile. Analysts like Eric Wold of Texas Capital Securities note that domestic box-office sales, projected to hit $8.8 billion this year, need to reach $10 billion for theatres to regain pre-pandemic profitability levels. The industry has invested heavily in upgrades—plush seating, premium screens, enhanced concessions—to lure audiences back, with chains like Marcus Corp spending $390 million over the past decade.
The Crucial Role of the Theatrical Window
The shortening of the period between a film's cinema debut and its streaming release is a critical issue. Before the pandemic, films typically enjoyed an 80-day theatrical window. Post-COVID, that average has shrunk to around 30 days, as reported by the Los Angeles Times.
Alicia Reese, a Wedbush senior analyst, warned of the long-term danger. “You’re training moviegoers to skip the theatrical window. And that’s the risk of it being too short,” she told CBC. However, she speculated that Netflix might learn to value exclusivity, stating, “My opinion is that while [Netflix] goes about honouring these exclusive theatrical windows, they will quickly learn the value of them.”
Netflix has stated it will honour Warner Bros.’ existing commitments to theatrical releases, which extend to 2029 or 2030. Yet, its plans beyond that date remain unclear, leaving the long-term future of cinema releases in doubt.
The Battle for Warner Bros. and Its Aftermath
The Netflix deal, which includes about $10 billion in debt and has an equity value of $72 billion, is not expected to finalise before the third quarter of 2026. It faces competition from a hostile bid by Paramount. Regardless of the winner, the consolidation signals a major power shift.
Netflix co-CEO Ted Sarandos framed the acquisition as a mission to “entertain the world,” combining Warner Bros’ iconic library—from Casablanca to Harry Potter—with Netflix hits like Stranger Things. Warner Bros Discovery CEO David Zaslav said the merger “combines two of the greatest storytelling companies in the world.”
For cinema operators like Marcus Corp CEO Greg Marcus, the solution remains simple: “When the movies are there, people want to go.” The question now is whether the biggest movies will still come to theatres first, or if the Netflix-Warner Bros deal marks the beginning of a profoundly different era for the big screen.
