An HBO Max subscriber from Las Vegas has filed a class action complaint against Netflix in an attempt to block its Warner Bros. merger. Discovery due to antitrust concerns and the potential for price gouging.
A Las Vegas woman called the acquisition “presumptively anticompetitive” in its documents, filed Monday and obtained by TheWrap. Its legal team also wrote that the deal could lead to steeper prices, citing Disney+ and Hulu as examples.
“In the last few years, after the SVOD Market emerged after the pandemic with a small number of dominant products — Netflix, Amazon Prime, HBO Max, Disney+, Hulu and Paramount Plus — market prices began to rise, with the quality of service and production stagnant or degraded,” says the 56-page lawsuit. “All this while SVOD subscription prices – including for Netflix and HBO Max – have risen well beyond inflation in recent years and more than doubled in less than a decade.”
He continues, “This market-wide price increase coincides with the recent merger, and continued consolidation, of two market-leading SVOD services, Hulu and Disney+, under common ownership, control and branding. The elimination of a major SVOD competitor by Disney has increased prices, reduced quality, and has not been offset by competitive revenue due to [Content and Subscriber Barrier to Entry].”
“The Netflix-WBD merger greatly strengthens CSBE across the US SVOD Market, and at the same time greatly increases concentration in an already calcified and oligopolistic market – a market that has responded to past consolidation with aggressive market-wide price increases and quality degradation,” it continues to note. “The proposed merger would increase the Herfindahl-Hirschman index in the US SVOD market by more than 500 points, from an already moderately concentrated baseline – a massive increase that is presumptively anticompetitive under the Department of Justice’s Horizontal Merger Guidelines.”
The class action lawsuit comes less than a week after Netflix and WBD entered into exclusive talks for the streamer to buy the studio and streaming assets of the legacy brand for $27.75 per share, a mix of cash and stock worth $82.7 billion. However, Paramount has since muddied the waters with a hostile takeover bid of $30 per share, an enterprise value of approximately $108.4 billion.
The post Netflix-WBD Merger Faces Antitrust Class Action on Behalf of HBO Max Subscribers: ‘Presumptively Anticompetitive’ appeared first on TheWrap .