Netflix Is Acquiring Warner Bros. And Its Games Division, Including Netherrealm, Rocksteady, And More

Warner Bros. Discovery has been shopping around for a new owner the past few months, and this morning, they entered negotiations with a new winner; Netflix won over Paramount and Comcast. The deal, which combines cash and stock, will see the Stranger Things streaming service acquire Warner Bros. for $82.7 million, while Discovery Global will spin off into a separate, independent company before the acquisition. Warner Bros. owns many major media brands, such as HBO and DC,  as well as Warner Bros. Games, a publisher that owns several major game developers. While this part of the deal was previously unclear, Game Developer has confirmed that this division will be acquired by Netflix as well.

The inclusion of Warner Bros. Games is ignored in the initial press release (the only games mentioned are Squid Game and Game of Thrones), and Game Developer reports that a conference call held this morning only briefly suggested the game publisher would be a part of the deal. Game Developer’s Chris Kerr writes, “Warner Bros. Games was briefly referenced during a conference call held this morning, when the Mortal Kombat logo was shown on a ‘Business Overview’ slide to highlight Warner Bros.’ wider game and consumer product exploits—but that blink-and-you’ll-miss-it-moment was largely it.” In a later call with a representative of Warner Bros. Discovery, however, Game Developer confirmed that the Warner Bros. Games division would be a part of Netflix’s deal.

Hogwarts Legacy, Mortal Kombat, and the Batman: Arkham series are just a few of the game series Netflix will own.

Warner Bros. Games owns several major gaming studios. There’s Netherrealm Studios (known for Mortal Kombat), Avalanche (developers of Hogwarts Legacy), Rocksteady (known for the Arkham series and the recent Suicide Squad game), and TT Games (known for the licensed Lego games, like Lego Star Wars and Lego Batman). There are also several WB Games studios, most notably WB Montréal, which developed Batman: Arkham Origins and Gotham Knights.

Netflix has attempted to break into the gaming scene in recent years, offering a wide range of mobile games as a part of a Netflix subscription, including apps like Cut the Rope, indie hits like Dead Cells, and even Rockstar ports like Red Dead Redemption and GTA: San Andreas. Netflix has also acquired several game studios, like Oxenfree developer Night School Studios. Netflix is currently collaborating with Life is Strange creators Don’t Nod on a mysterious game adaptation of a “major IP”. Still, it’s unclear how far these efforts have gotten them, and adding major console developers to its portfolio could make a huge difference.

It will likely be a while before we see the results of this merger; the transaction process is lengthy and is estimated to last 12-18 months. This also assumes antitrust regulatory bodies don’t get involved to slow the process, and with a deal of this size, it would not be surprising. The last deal we covered on this scale was Microsoft’s acquisition of Activision Blizzard, which fought a major legal battle but ultimately succeeded. The jury is still out, however, on whether that merger was good for consumers or employees, as Microsoft has since laid off thousands of employees, closed several major studios, and raised the prices of its consoles and subscription service.