Dec 5 : Hollywood unions and theater owners on Friday sounded the alarm over Netflix's proposed $72 billion takeover of Warner Bros Discovery, warning the deal would cut jobs, concentrate power and reduce theatrical movie releases if the deal passes regulatory review.

The deal would place the streaming giant's HBO brands under the Netflix umbrella and also hand control of the historic Warner Bros studio over to Netflix, which has already upended Hollywood by hastening the shift from movie releases in cinemas to home streaming.

Netflix, the force behind "Stranger Things" and "Squid Game," could gain control of marquee Warner Bros titles such as "Batman" and "Casablanca." 

"This merger must be blocked," the Writers Guild of America East and West said in a statement. "The world’s largest streaming company swallowing one of its biggest competitors is what antitrust laws were designed to prevent."

Subscribe to our Chief Editor’s Week in Review

Our chief editor shares analysis and picks of the week's biggest news every Saturday.

This service is not intended for persons residing in the E.U. By clicking subscribe, I agree to receive news updates and promotional material from Mediacorp and Mediacorp’s partners.

Loading

The deal faces antitrust reviews in the United States and Europe, and American politicians have already expressed skepticism.

The Writers Guild, which represents writers in motion pictures, television, cable, broadcast news, podcasts and online media, raised concerns over job cuts, wage reductions, higher prices for consumers and worsening conditions for entertainment workers. Netflix said it expects to generate at least $2 billion to $3 billion in annual cost savings by the third year after the deal closes.

The Netflix-Warner Bros deal risks eliminating 25 per cent of the annual domestic box office, said Cinema United, the trade group representing 30,000 movie screens in the United States and 26,000 internationally.

Netflix does release some films in theaters before making them available to subscribers, and the company said it would maintain theatrical releases for Warner Bros films and support Hollywood creative professionals. 

Netflix said the deal would give subscribers more shows and films, boost its U.S. production and long-term spending on original content and create more jobs and opportunities for creative talent. Warner Bros Discovery did not immediately respond to Reuters requests for comment on the opponents' concerns.

But Cinema United President Michael O'Leary called the merger "an unprecedented threat" and questioned whether Netflix would maintain the current level of distribution. "Sporadic and truncated theatrical releases to meet awards criteria in a handful of theaters is not a commitment to exhibition," O'Leary said.

The Hollywood Teamsters, who represent drivers, casting professionals, mechanics and other workers in the entertainment industry, also opposed the deal, calling for "opposition across all levels of government" while urging antitrust enforcers to reject the deal.

"Teamsters have been clear on our position that greed-fueled consolidation of corporate power, no matter what industry, is a direct threat to good union jobs, the livelihood of our members and the very existence of our industry," the union said in a statement.

The Directors Guild of America, however, was more reserved, saying it had significant concerns to discuss with Netflix.

"We will be meeting with Netflix to outline our concerns and better understand their vision for the future of the company. While we undertake this due diligence, we will not be commenting further," the DGA said in a statement.

The screen actors union SAG-AFTRA said the merger "raises many serious questions" and it would comment further on the impact on its members after analyzing the deal.

LONDON: Surrounded by kick-boxing, piano-playing humanoid robots at a high-tech fair in Shenzhen last month, some tech influencers were asking: Can the West catch up with China?

That question would have sounded absurd two decades ago, but it is anything but today. This week, the Australian Strategic Policy Institute published its latest critical technology tracker, covering high-impact global research in 74 areas. It found that China now leads in 66 of those technologies, in fields as varied as computer vision, quantum sensors and nuclear energy, with the US ahead in the other eight. 

ASPI’s researchers highlighted a familiar story across many technologies. An early and overwhelming US lead in research output in the first decade of this century has been surpassed by China’s persistent long-term investment in fundamental research.

In 2005, China accounted for just 6 per cent of the world’s most highly cited research papers but that share had risen to 48 per cent this year. The comparable proportion of US publications fell from 43 per cent to 9 per cent. At a time when the US is defunding many federal science programmes, China is doing the opposite by “building the whole technology ecosystem”, says Jenny Wong-Leung, one of the report’s authors. 

ASPI’s findings accord with Nature’s latest ranking of research institutions, tracking articles across 145 science journals. In terms of research output, nine of the world’s top 10 research institutions are Chinese with only Harvard University in the top tier. China is now mass manufacturing research; it truly has become a scientific superpower.

THE AI RACE

Published research, though, does not automatically translate into technological capability. Moreover, the location of research expertise does not always map with successful commercialisation of technology – as a long line of frustrated British scientists can attest. 

However, a separate report from the Special Competitive Studies Project in the US earlier this year also highlighted the striking progress that China has made in adopting many frontier technologies.

According to the SCSP’s staff assessment, the US is still leading in semiconductors, synthetic biology and quantum computing while China dominates in advanced batteries, 5G and commercial drones. But the most contested, and arguably most consequential, area is artificial intelligence.

President Donald Trump has said that the US will do “whatever it takes” to lead the world in AI. And the big US tech companies, including OpenAI, Alphabet, Microsoft, Meta and Amazon, are making colossal investments to fulfil that ambition. OpenAI alone is planning to invest US$400 billion over the next few years to build out its Stargate data centres across the US.

Last month, the Trump administration launched the Genesis Mission to boost the private AI sector by sharing the public data sets and computing resources of the country’s 17 national laboratories.

“We’re essentially pitting our private capitalists against this nation state of China. The stakeholders here have two very different sets of resources, attributes, strengths and weaknesses,” says David Lin, a senior adviser to the SCSP.

DIFFERENT AI MODELS

But the US and China are also adopting very different approaches to adopting AI. The big US companies mostly favour massive, proprietary, “closed-weights” models, such as ChatGPT and Gemini, which may be best suited to achieving generalisable intelligence.

By contrast, Chinese AI companies favour smaller, cheaper (and arguably less safe) “open-weights” models, such as DeepSeek and Alibaba’s Qwen, that can be more readily adapted by developers.

In part, China is making a virtue of necessity because US export restrictions have denied it access to the state-of-the-art silicon chips needed to build the most powerful foundation models. But it also reflects China’s priority in rapidly diffusing the technology.

Michael Power, the former global strategist of the investment firm Ninety One, reckons the US is making a “catastrophic strategic error” in betting so heavily on giant closed AI models.

“China’s model is turning out to be far more effective in terms of usable compute in the real world,” Power tells me, especially considering the country’s lower energy costs. Even Sam Altman, OpenAI’s chief executive, has expressed his personal concern that “we have been on the wrong side of history here”.

A recent study by MIT and Hugging Face found that Chinese open models have now overtaken comparable US models in terms of global adoption. Many US companies, including Airbnb, have become fans of the “fast and cheap” Qwen. In this critical area too the question arises: Can the West catch up with China?