European cinema trade body the UNIC has come out against Netflix‘s planned $82.7 billion takeover of Warner Bros., saying the deal will be bad news for the theatrical business.
In a statement on Friday, issued shortly after Netflix and Warner Bros. made the takeover bid official, the UNIC said the proposed deal “represents a double risk” with fewer films being produced and fewer of those being made getting released in cinemas.
“As elsewhere, cinemas in Europe rely on one product for their viability: films. And to ensure they can attract and successfully serve the widest possible audience, that flow of content needs to be consistent and diverse, with an exclusive period of release supported by effective marketing,” the statement reads. “By that measure, the planned acquisition of Warner Bros. by Netflix fails in every regard.”
The loss of a studio “will inevitably mean that cinemas will have fewer films to screen for their audiences, leading to reduced income and significant cinema closures and job losses in the industry,” Laura Houlgatte, CEO of UNIC wrote. But worse than that, she argues, Netflix has shown “time and again” that “it doesn’t believe in cinemas and their business model. Netflix has released only a handful of titles in cinemas, usually to chase awards, and only for a very short period, denying cinema operators a fair window of exclusivity.”
Announcing the deal on Friday, Netflix said that it expects to maintain the current operations of Warner Bros. “including theatrical releases for films,” without giving specific details. Netflix is spinning the takeover as an opportunity for filmmakers and creatives to have access to both Warner Bros.’ “renowned franchises and extensive library,” and to Netflix’s unparalleled global reach, providing “more opportunities to work with beloved intellectual property, tell new stories and connect with a wider audience than ever before.”
Phil Clapp, President of UNIC and Chief Executive of the UK Cinema Association, said regulators looking at the deal have to take into account “its consequences for the cinema exhibition sector and the wider public. Any reduction in the diversity and quality of content arising from this acquisition, combined with the potential loss of cinemas and jobs, would have a profoundly damaging impact on Europe’s cultural landscape.”
The UNIC represents exhibitors across 39 territories in Europe with a reach of 43,500 screens.