Paramount merger with Warner Bros.: Four ways it could affect your life

Author, Francisco Velasquez

role, business reporter

Reported from, New York

and

Author, Regan Morris

Reported from California

Posted 3 minutes ago

Reading time: 3 minutes

After months of work, Paramount Skydance has finally completed its $110bn (£82.8bn) merger with Warner Bros Discovery.

The deal combines two established Hollywood giants, bringing together franchises such as "Harry Potter" and "Game of Thrones" to form an entertainment giant called Skydance.

Behind the milestone, however, are strict rules about what the combined business can and cannot do, from how many movies it must produce each year to the editorial independence of its newsrooms.

Here are four ways the deal could affect you and the movies, TV shows and news you watch.

1. Streaming prices may rise

Warner Bros. owns HBO Max, whose content includes "The Sopranos," "House of the Dragon" and "Euphoria." Paramount Skydance owns Paramount+, which includes shows such as "Yellowstone," "Parks and Recreation" and "NCIS."

Combining HBO Max and Paramount+ into a single platform or bundle is likely to squeeze subscriber wallets in the long run.

While existing users who subscribe to both services may save money in the short term, analysts expect overall prices to rise as the combined giant looks to turn a profit.

The merged company, Skydance, has taken on as much as $80 billion in debt as a result of the deal, and at the same time, company executives aim to cut costs by $6 billion a year.

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Analysts warned that consumers would ultimately bear the financial burden of the $110 billion deal.

Mike Proulx, research director at Forrester, pointed out that continuous price increases for streaming services can improve profits, and Skydance is saddled with huge debts, so price increases are likely to come.

While viewers will have access to a wider library as Skydance moves to a Paramount+ and HBO Max bundle rather than a single app, Proulx warned: "It's unrealistic to think this will prevent downstream price increases."

2. More movies released

As part of a settlement with U.S. states that had opposed the merger, Paramount Skydance has agreed to release a fixed number of movies each year for the next five years.

In the first two years, the number is 30 films per year, and in the remaining years, 32 films must be released per year.

That's 156 films in total - most of which must be "wide releases," meaning they must be shown in theaters.

The combined studio would also be required to release at least four independent films per year.

If Skydance fails to meet its film quota, it may be forced to sell its 49% stake in Miramax, the film and television company co-founded by disgraced Hollywood tycoon Harvey Weinstein.

Breanne Gilliam, a corporate attorney at law firm Maddin Hauser, said the film commitment makes sense even if it has an expiration date.

"Once these obligations expire, companies will have much greater flexibility," she said.

"Temporary rules cannot permanently correct structural market shifts."

When the five-year deal ends, Skydance may follow rivals such as Disney and Netflix in prioritizing streaming over cinemas.

As Disney's $71 billion acquisition of 21st Century Fox in 2019 demonstrated, mega-deals can result in fewer movies being released in theaters.

Before the acquisition, 20th Century Fox typically released 12 to 17 movies a year in theaters, but under Disney, that number has shrunk to just three to six a year.

3. Hollywood jobs may be affected

For those behind the scenes, the merger of these two long-established film and television companies was described as a "disaster" by industry insiders.

Actors and screenwriters recently gathered outside Paramount Studios in Los Angeles to oppose the deal, accusing regulators of failing to protect industry livelihoods.

Criminal Minds star Kirsten Vangsness told the BBC she was "heartbroken".

"It's the people who make this city," she said. “People make the entertainment industry, and the industry is built on these everyday creators—and it’s them who suffer the most.”

A report for Los Angeles County by CVL Economics, a consulting firm, estimated that the merger could eliminate about 4,500 direct film and television industry jobs and cause $1.26 billion in lost wages over three years.

The blow is likely to fall in a region that has lost about a third of its film and television workers since 2022, equivalent to about 50,000 jobs.

"This will ripple through small businesses, suppliers, caterers and the local community," said Syleecia Thompson, a business professor at National University.

She warned that Hollywood may become less of a "single stronghold" and more of a "decentralized network."

While the settlement establishes a workforce training fund to help displaced workers transition, attorneys noted that it does not prevent layoffs.

"There is nothing in the agreement that limits layoffs," attorney Gilliam added.

4. CNN and CBS may change

In response to concerns about the independence of CNN and CBS News, the settlement established an independent committee of news editors appointed directly by Paramount.

The $110 billion deal brings America's two largest television news organizations under one corporate roof. Before the deal, Paramount owned CBS News and Warner Bros. owned CNN.

Both networks are facing intense political pressure — CNN was one of a handful of news organizations banned from the White House by President Donald Trump — and are undergoing leadership changes amid a wave of industry consolidation.

Paramount chief executive David Ellison has invited CNN president Mark Thompson - the former BBC boss - to stay at the helm after the acquisition is completed. CBS News managing editor Bari Weiss will also remain on board.

Seth Stern, director of advocacy at the Freedom of the Press Foundation, called the Paramount-appointed committee "worthless."