The Abundance Paradox

Netflix has agreed to buy Warner Bros. in a deal valued at more than $82 billion, a move Sequoia calls the biggest and most consequential in Hollywood history. The package brings a pile of famous intellectual property with it: Batman, Superman, Harry Potter, Game of Thrones, The Big Bang Theory, The Sopranos, The Matrix, Lord of the Rings film rights, Godzilla/MonsterVerse, Mad Max and Mortal Kombat.

Sequoia’s argument is simple and a little counterintuitive. As AI pushes the cost of making content down, the supply of content will explode. That sounds like a recipe for abundance. But the firm says abundance doesn’t make everything cheap. It makes attention scarce, and that changes what people actually value.

The example it reaches for is the Musée d’Orsay in Paris, where industrial-era art became more, not less, prized as reproduction got easier. The same logic, Sequoia says, will apply to intellectual property in the AI era. When imitation gets cheaper, the original gets more precious. Not every original, of course. The ones that already live in people’s heads will have the edge.

That’s why Sequoia thinks nostalgic content sits in a sweet spot. AI can copy style and churn out endless new material, but it struggles with the exact details that make familiar characters and stories feel real. A slightly wrong voice, a small anachronism, one off note in a beloved narrative — and the whole thing starts to feel fake. In a market flooded with novelty, that kind of authenticity becomes the product.

The bigger point is that discovery will matter more as creation gets cheaper. Sequoia expects consumers to lean on dominant platforms to sort through the flood, while very few new ideas break out. So the value won’t sit with whoever can make the most stuff. It’ll sit with whoever already owns the stories people keep returning to.