Netflix Co-CEO Ted Sarandos Defends Warner Bros. Discovery Deal, Says YouTube Is More Than 'Cat Videos' - Ross Gerber Agrees

On Tuesday, Netflix Inc. (NASDAQ:NFLX) co-CEO Ted Sarandos argued before U.S. senators that YouTube has become television in every meaningful sense, a defense of the company's Warner Bros. Discovery (NASDAQ:WBD) acquisition.

Sarandos Reframes Streaming Competition Around YouTube

Testifying before the U.S. Senate Judiciary Committee, Sarandos pushed back against concerns that Netflix's proposed acquisition of Warner Bros. Discovery would create a monopoly, arguing that regulators are misreading the modern media landscape.

"YouTube is not just cat videos anymore," Sarandos said, describing YouTube, a subsidiary of Alphabet Inc.'s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google, as the largest television platform by viewing time.

He cited the platform's NFL football rights, exclusive Oscars deal, partnerships with the BBC and the growing scale of creator-led productions that now rival traditional Hollywood budgets.

Sarandos also noted that roughly half of YouTube viewing now happens on television screens in living rooms, a shift that challenges the perception of YouTube as primarily a mobile-first service.

Netflix Says Its Market Share Remains Limited

Sarandos told lawmakers that Netflix accounts for about 9% of total U.S. TV viewing time and would reach roughly 10% even after combining with Warner Bros. Discovery.

He said when they are talking about competing for viewers' attention, ad dollars and subscription dollars, "it's all the same pool," Sarandos said, framing the deal as necessary to compete for time and attention rather than dominance.

Ross Gerber Praises Netflix CEO's Senate Testimony

The comments gained traction after Yahoo Finance shared a clip of the hearing on social media. Ross Gerber, co-founder of investment firm Gerber Kawasaki, reposted the video and wrote, "Really well said."

Warner Bros. Discovery Deal And Antitrust Battle

Netflix last month shifted to an all-cash offer valued at $82.7 billion for Warner Bros. Discovery's studio and streaming businesses, winning unanimous board approval and sidelining rival Paramount.

The deal would give Netflix control of HBO Max, Warner Bros.' film and television studios and franchises, including "Harry Potter," DC Comics and "Game of Thrones."

Netflix co-CEO Greg Peters has previously described YouTube as the company's most formidable competitor.

Price Action: Netflix shares closed down 3.41% at $79.94 on Tuesday, with the stock rising 0.20% to $80.10 in pre-market trading on Wednesday, according to Benzinga Pro.

NFLX stock scores highly on Quality in Benzinga's Edge Stock Rankings but shows a negative price trend across the short, medium and long-term time frames.

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