The WBD Merger and its Impact on Creative Labor
- WULR Team
- 2 days ago
- 4 min read
As Warner Bros. Discovery prepares to be sold, creative workers face shrinking leverage in future contract negotiations.
Published March 20th, 2026
Written by Harrison Crawford
The potential sale of Warner Bros. Discovery to Netflix represents an upheaval of the existing entertainment industry. On December 5, WBD accepted a $72 billion offer from Netflix for its studio and streaming assets, pending approval from regulatory agencies. This potential merger would narrow the employment options of those working in the industry, changing the studio landscape ahead of the Minimum Base Agreement renegotiations for writers, actors and directors in 2026.
According to Forbes, a merger with Netflix would give the company control of 30-40% of the U.S. streaming market. However, this deal faces the obstacle of antitrust laws, imposed by the Department of Justice and the Federal Trade Commission, collectively known as “the Agencies”.
The 2023 DOJ/FTC Merger Guidelines are designed to block mergers and acquisitions that greatly decrease competition. As Netflix is a prominent film and TV producer and is already the most popular streaming service in the world, a WBD merger would trigger horizontal and vertical integration concerns. There is some comfort in the fact that Netflix is not interested in WBD’s linear network assets, such as CNN, TNT and the Discovery Channel. This will mean that, regardless of the merger’s approval, those assets will exist as a separate company, helping to protect consumers from increased prices and reduced options. Still, the assets in which Netflix is interested, such as HBO Max and Warner Bros.’ film and TV library, represent a greater share of the markets in which they are already heavily invested. With a consolidated streaming service, Netflix would have greater incentive to raise their subscription price, especially to offset the costs of the WBD merger, according to Michael Carrier, a law professor at Rutgers University.
However, consumers are not the only group that needs protection in the event of a merger. The creatives behind film and TV content need assurances that their interests are guarded, and even with the measures briefly described above, major blind spots in the Merger Guidelines exist that leave creatives vulnerable. While the types of work that these people perform vary greatly and some groups, such as A-list actors, have fewer vulnerabilities than those just breaking into the industry, all need protections. To better establish these, the Agencies should place a greater focus on monopsony prevention in the labor markets that contribute to film, television and live broadcasting.
The concerns of the creatives employed by these companies is illustrated in the highly-publicized 2023 union strikes of the Writers Guild of America and the Screen Actors Guild and the American Federation of Television and Radio Artists. These unions were unable to reach new MBA agreements ahead of the deadlines; the MBAs must be renegotiated every three years. These strikes heavily involved two emerging issues: streaming residuals and AI. As streaming is a relatively new technology and its place as a cornerstone of media consumption is evolving rapidly, regulations are still being formed. During the 2023 negotiations, the WGA was able to secure a viewership-based system for residuals. According to the WGA 2023 MBA, creators can receive a bonus provided that their project gained sufficient viewership on a streaming service. Also, streaming services are now required to disclose viewership data information to the WGA. Regarding AI, the new MBA assured that AI cannot be used to write or rewrite scripts, studios can’t compel a writer to use AI and AI programs cannot be trained on a writer’s work without their consent.
The summary of the SAG-AFTRA 2023 MBA reveals similar protections for actors. In addition to the potential for a viewership bonus, there is a data transparency section similar to the WGA’s. The MBA includes AI protections preventing a studio from, without the actor’s consent, creating a digital copy of their likeness or significantly digitally altering their performance in post-production and, if a digital double is used, the actor is entitled to compensation for the use of their likeness. Additionally, procedures are created for SAG-AFTRA to bargain against the use of “Synthetic Performers,” AI-generated “actors” that are not meant to resemble any specific person but are performing a role in a project that could have been performed by a real actor. All of these principles apply to background actors as well.
Though the current MBAs include important steps toward greater protections for writers and actors, these MBAs will need to be renegotiated in 2026 and the prospect of a Netflix-WBD merger brings concerns of this new firm’s increased bargaining power. While the current Merger Guidelines recognize harms to workers, the tools of analysis that are used by the Agencies do not map well onto the interests of creative workers in the entertainment industry. There are several mentions of wage protections in the face of a merger, but many of these creatives rely on non-wage compensation (back-end participation, residuals, licensing payments, etc.) and, in the case of AI, these methods are vital to ensuring that studios cannot profit off of a creative’s work without consent and fair compensation. However, the Guidelines’ protection of bargaining structures are not sufficiently developed. A consolidated firm would likely have increased power to standardize contractual terms, suppress downstream compensation, and automate roles with AI. Even to gain the existing protections, writers and actors had to go on strike, something that should ideally be unnecessary. To better address modern concerns, merger review guidelines should include tools to assess whether consolidation increases a media company’s ability and incentive to overextend the application of AI and alter existing residual formulas. Without antitrust considerations for the unique challenges of creative workers, a merger like the one in question can threaten the gains that the WGA and SAG made in 2023, revoking vital protections as streaming and AI continue to evolve rapidly and studios increasingly consolidate their power.
