Paramount just cleared one of the biggest hurdles standing between it and Warner Bros. Discovery.
The company has reached a settlement with California and 11 other states that sued to stop the roughly $110 billion merger, bringing these two Hollywood giants significantly closer to becoming one company.
Part of the agreement is reportedly that Paramount will create independent editorial boards for both CNN and CBS. It faces a $30 million penalty for every film it falls short on if it fails to meet its commitment to release 30 movies theatrically each year. Deadline reports that the agreement will also include investment in domestic film production, along with protections around California production and studio operations.
Paramount also settled with The Writers Guild of America, which sued to stop the deal, arguing it would decrease pay and worsen working conditions for film and television writers. But there are still plenty of underlying consequences of consolidation.
This deal would put an enormous collection of Hollywood’s most recognizable assets under one roof: Paramount Pictures, CBS, Paramount+, Warner Bros., HBO, HBO Max and CNN, BET and others.
Paramount has told investors it expects roughly $6 billion in cost savings from the combination. And in media, “efficiency” always translates into eliminating jobs immediately. That doesn’t just mean actors and writers. Think editors, camera operators, producers, production assistants, electricians, transportation workers and caterers.
And for people trying to break into this business, consolidation can mean fewer doors to knock on. As New York City Mayor Zohran Mamdani wrote earlier this year: “This is not a merger that serves the public. It would hand one company nearly a third of the movies and cable channels Americans watch, raise prices for streaming and cable, endanger the livelihoods of thousands of New York artists and entertainment workers, and threaten to shutter theaters across our city.”
Opponents of the merger have continued protesting and pushing state officials for stronger protections. There was a “Block the Merger” protest in New York just yesterday. But even if the job loss doesn’t bother you, the question about who owns the media Americans consume should.
The Federal Communications Commission just approved a structure allowing sovereign wealth funds from Saudi Arabia, Qatar and the United Arab Emirates to collectively hold up to 49.5 percent of Paramount’s equity. Meaning foreign governments are becoming major financial stakeholders in a company that owns major American television and news properties.
Paramount is doing whatever it can to get this deal to the finish line, because the company has a financial clock ticking: Reuters reports the company faces a roughly $7 million-a-day fee to Warner Bros. shareholders after Sept. 30 if the transaction isn’t completed by then. But the real losers of rushing this thing will ultimately be the average American.
