Paramount Skydance and Warner Bros. Discovery now appear close to finalising the $110 billion deal for the merger of the two major media groups, following the resolution of the antitrust lawsuit brought by California along with eleven other states.
In Europe and the United Kingdom as well, the merger between the two companies had already received clearance from the relevant authorities some time ago; what was still missing was approval on the American side, which has now arrived thanks to California’s Attorney General, Rob Bonta, who had previously raised concerns about possible anticompetitive effects and resulting price increases.
The approval from the United States, however, requires further clarification. Bonta was careful to point out that the agreement reached does not amount to an endorsement of the merger itself. The conditions imposed merely establish the boundaries of the new giant that will emerge from the union of the Paramount and Warner studios, the Paramount+ and HBO Max platforms, and CBS and CNN.
The film industry is therefore the first sector to face this test. Paramount will be required to increase its investments by $300 million compared to 2025, reaching a total of $1.5 billion over five years. It will also have to guarantee the release of 30 films a year in the first two years, rising to 32 in the following three. Of these, four must be independent productions, while the number of wide-release titles will rise from 20 to 21 starting in the third year. An annual fund of $5 million is also planned to support independent film. Failure to meet these commitments would result, after six months, in the sale of the stake held in Miramax.
As for jobs, the Paramount studios in Los Angeles and Warner‘s in Burbank will remain operational at least until the end of 2031. A fund of $47.5 million is also planned to support retraining programmes for employees who lose their jobs. On cable television, for the next five years, the channels belonging to the two groups will be negotiated commercially on an independent basis. Should this commitment not be honoured, the consequence would be the sale of certain networks, including BET, VH1, and Comedy Central.
To safeguard journalism and prevent potential conflicts between the CBS News and CNN newsrooms, an independent committee will be established — made up of an internal officer, an external trustee, and representatives from five states — tasked with setting the editorial and journalistic principles that will guide the two outlets.
As for the Writers Guild of America, the agreement includes a $17.5 million health fund and a set of protections for CBS and CNN employees. It also confirms reimbursement of up to $40 million for legal and expert fees incurred by the states, while Paramount will avoid having to pay the $7 million-a-day penalty owed to WBD shareholders for delays beyond September 30. Meanwhile, both the $6 billion in savings expected from the deal and the roughly $80 billion in debt expected for the combined group remain unchanged.
A significant financial burden for David Ellison, CEO of Paramount Skydance, coming alongside the long-awaited achievement of this merger, with the ultimate goal of a stronger Hollywood.
Photo credit: Paramount Skydance Corporation and Warner Bros. Entertainment via Wikimedia Commons
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