'We actually didn’t attribute any value' to Warner's game studios, Netflix boss says about the acquisition deal: 'They’re relatively minor compared to the grand scheme of things'
Netflix recently won the bidding war for Warner Bros. Discovery, making a deal to acquire the company for nearly $83 billion. That includes its film and television studios, HBO and HBO Max and all their properties, the whole of the DC Universe, and of course its remaining game studios. Those game studios are obviously of great interest to us, but for the people at Netflix? I don't want to bruise any egos here but, well, not so much.
The Netflix disdain was expressed in an investors Q&A earlier this week, when a caller asked if the WBD acquisition would "enhance or accelerate" Netflix's gaming ambitions, which have floundered after a hard-charging start: Netflix has closed or sold off the studios it made such a big point of having just a few years previously, and it's biggest idea these days seems to be laying out huge amounts of money for generative AI.
Warner, on the other hand, despite some recent major botches of its own, still brings significant gaming strength to the table. That doesn't seem to figure into Netflix's plans, though. Netflix co-CEO Gregory Peters acknowledged that the WBD pickup would be a boon for his company's gaming division, but not to the extent that it makes any real difference.
"While they definitely have been doing some great work in the game space, we actually didn’t attribute any value to that from the get-go because they’re relatively minor compared to the grand scheme of things," Peters said.
"Now we are super excited because some of those properties that they’ve built, Hogwarts is a great example of that, have been done quite well, and we think that we can incorporate that into what we’re offering. They’ve got great studios and great folks working there. So we think that there’s definitely an opportunity there. But just to be clear, we haven’t built that into our deal model."
Oh. Well. Okay.
Hogwarts Legacy was indeed a huge hit, and in 2024 Warner said developing a sequel was one of its "biggest priorities." But the spectacular, extremely expensive failures of Suicide Squad: Kill the Justice League and Multiversus forced WB Games to embark upon a major restructuring less than six months later, which saw studio closures and the cancellation of multiple projects, including a reported Hogwarts Legacy expansion and "definitive edition."
The Hogwarts legacy sequel was reportedly still in development at that point but it's clearly not a priority for Netflix, and with Warner's fate seemingly up in the air—Netflix won the bidding war, but Paramount has launched a hostile takeover bid—what will ultimately happen to it, and the rest of Warner's once-powerful gaming division, is anyone's guess.
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