Netflix is now in the weird business of making shows for Apple TV

According to AppleInsider, Netflix will start licensing Warner Bros. TV shows to competitors, including Apple TV+, marking a major pivot. This follows Netflix’s acquisition of Warner Bros. Discovery for a massive $83 billion in early December. The deal gives Netflix control of Warner’s content and operations, including the studio behind Apple TV+ hits like “Ted Lasso,” “Shrinking,” and “Bad Monkey.” Netflix co-CEO Ted Sarandos confirmed the strategy, stating the company now owns a “really healthy” licensing business it plans to continue. This puts Netflix in the unique position of producing premium shows for its direct rivals. The Warner Bros. Television Group, led by CEO Channing Dungey, will continue deciding which properties get licensed out.

The weird new reality

So, let’s get this straight. Netflix, the company that spent a decade convincing everyone that exclusive originals were the only path to streaming dominance, is now going to be the studio making must-watch shows for Apple TV+. It’s a bizarre twist. Here’s the thing: when Netflix bought Warner Bros. Discovery, it didn’t just buy a library—it bought a massive, old-school television production machine. And that machine has lucrative, long-term deals to make shows for other people. Sarandos basically admitted they stumbled into this business, and it’s too profitable to shut down. Why kill a golden goose, even if it’s feeding your competition?

Why this makes sense for Netflix

Look, it comes down to simple economics. The streaming wars have entered the “grind it out” phase. Growth is harder, and everyone needs revenue. Netflix’s core subscription business is huge, but it’s also incredibly capital intensive. Licensing studio production to others is a far less risky revenue stream. Apple, for instance, pays Warner Bros. Television to produce “Ted Lasso”; that’s guaranteed money for Netflix now. It’s a high-margin, B2B operation that offsets the wild costs of the B2C streaming battle. I think it’s a pragmatic, if ironic, move. They’re leveraging a legacy business they never wanted to help fund the future business they’re desperate to keep.

The bigger picture and risks

But doesn’t this undermine Netflix’s own platform? That’s the billion-dollar question. There’s a clear trade-off. You gain steady, profitable revenue, but you potentially strengthen a competitor’s content slate. Apple TV+’s identity is heavily tied to Warner-produced shows like “Ted Lasso.” Now, Netflix is essentially subsidizing that identity. The calculation, presumably, is that the cash is worth more than the competitive disadvantage. And let’s be real—Netflix probably believes its own algorithm and volume can outmuscle any single show it lends out. It’s a bet on scale over exclusivity. Still, it’s a strange look for a company that used to preach the gospel of “Netflix Originals.” The era of walled gardens is getting a lot more porous, and Netflix is now one of the main architects tearing down the walls.