Mario Zúñiga Quoted in El Comercio on Netflix-Warner Bros. Discovery Acquisition
ICLE Senior Competition Scholar Mario Zúñiga was quoted in the Peruvian outlet El Comercio discussing the regulatory challenges and competition analysis surrounding the proposed acquisition of Warner Bros. Discovery (WBD) by Netflix. Mario states that the operation should be approved, arguing that Netflix does not possess a dominant market share, even as the streaming market leader. Read the full article here.
Translation: Although political decisions could carry more weight than technical positions, for Mario Zúñiga, senior researcher at the International Center for Law and Economics, the operation proposed by Netflix to buy WBD should be approved; because even though Netflix is the leader in the ‘streaming’ market, the company does not necessarily possess a share that can be considered dominant.
“If the Department of Justice (which would see this case) wanted to block it, it would have to file a lawsuit before the U.S. Judiciary, where judges usually rely on economic evidence for their decisions,” comments Zúñiga.
In that sense, Zúñiga considers that a crucial step during the process will be the definition of the relevant market: “If the market is defined narrowly (only ‘streaming’ platforms), Netflix is the leader but does not have a dominant share, and HBO is the third [in the U.S.],” he explains. However, the specialist points out, if the market is defined more broadly and includes competitors like YouTube, cable television, and other content providers, Netflix’s market share is significantly reduced.
Zúñiga also describes the ‘streaming’ market as a competitive one, where there is the trend of ‘multihoming,’ which implies that users subscribe and unsubscribe frequently across different platforms, according to their needs and budget; the existence of substitute apps, such as YouTube and cable television; and the presence of actors that continue to grow, such as Apple TV and Amazon Prime.