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Since its transition from a DVD-by-mail service to streaming platform in 2007, Netflix has solidified itself as the prominent herald of the streaming era. While studios relied primarily on theater revenue leading up to COVID-19, platforms like Hulu and Amazon Prime Video that had been formed much earlier felt the burden of lockdown much less, with Netflix leading the charge. But while streaming platforms soared to new heights, theaters faced the threat of collapse.
Following Netflix's attempts to acquire Warner Bros. motion picture/entertainment company, the theater industry is once again placed in a precarious situation. Whether theaters survive this next stage of evolution in the film industry may very well be in the hands of Netflix should the acquisition go through.
The Health of the Theater Industry Now
In the face of COVID-19 lockdown, many businesses fell to the wayside. Theaters were among the many casualties as many films delayed release until 2021. 5 years later, and theaters are only beginning to recover from the damage done to the industry.
In 2020, Box Office Mojo saw over an 80% decrease in domestic gross box office earnings, with the average movie grossing about $4.6 million compared to the 2019 average of about $12.5 million. In 2025 that number has finally started to see an increase with the average moving grossing roughly $13 million domestically. However, in terms of total earnings there is still a large gap between lockdown and the present day. Total gross domestic earnings for films in 2019 made it up to over $11 billion. Today, that number remains in the single digits, with 2025 gross domestic earnings totaling about $8.6 billion.
The theater industry is still in recovery. Theaters only see 30-45 day runs compared to the typical 90 day runs prior to lockdown. With domestic earnings finally starting to hit the green, the acquisition of one of the original Big 5 corporations leftover from the studio era has the potential to make big waves that could wipe out the theater industry altogether.
What Netflix and Paramount Are Set to Earn
Netflix and Paramount are both powerhouse studios, producing well-known franchises like Knives Out and Sonic the Hedgehog – both of which released their third installments this year with great success. So what would purchasing Warner Bros. mean for these two studios?
Results differ slightly depending on whether you are looking at the streaming industry or the box office. Ultimately though, whether Netflix or Paramount is awarded the acquisition, the winning company will become a dominant force in the film and television industry's supply chain.
Benefits Within the Streaming Industry
Let's look at the streaming industry first. An analyzation compiled by Kostas Farkonas (2026) on the 2025 streaming charts determined that "Should the acquisition of HBO Max by Netflix go through, a possible unified service would account for no less than 33% of the US streaming market..."
For Paramount+, which currently represents only 5% of the streaming industry compared to Netflix's 20%, this would mean going from being on the lower end of the top 10 streaming streaming services, to being number 2.
Benefits Within and Threats to the Theater Industry
Warner Bros. is also a big ticket item at the the box office. According to data from The Numbers, Warner Bros. represented over 20% of gross earnings in the domestic box office for 2025, trailing closely behind Disney. Comparatively, Paramount Pictures represents under 7% of gross domestic earnings. Paramount acquiring Warner Bros. in addition to their own productions would theoretically allow them to take an authoritative number one spot in box office earnings.
Netflix is a bit of a different story. Currently, Netflix releases its films in select theaters for limited 17-week runs. This is already almost half the minimum 30-45 day runs typical films see in theaters, and the current standard for Warner Bros. As a result, Netflix only represented 0.31% of box office earnings last year. If Netflix takes Warner Bros. and continues with the standard 30-45 day runs, they have the potential to move up to the top 3 box office earners.
CEO Ted Sarandos told Variety interviewer Todd Spangler that Netflix plans to keep Warner Bros. in theaters for 45 day runs. This would be a very big step for Netflix and a win for theaters. However, if they were to relegate Warner Bros. to their current model of 17-week runs, it could be catastrophic for the theater industry.
Final Thoughts
Acquisition of Warner Bros. offers to shift the scales of power within the film world. Whether Paramount or Netflix are successful in their acquisition attempts, both theaters and streaming are likely to change drastically in the transfer of ownership.
As of January 16th, the current bid from Netflix is $83 billion cash. Paramount has yet to respond to this bid, making Netflix's victory seem closer than ever. Therefore, the jury is still out on whether theaters will once again rise from the brink of extinction in the face of this new era of film, or join the ranks of Blockbuster and Redbox in purgatory.
