We almost spent one All year awaits and waiting for Fallings business to merge with Paramount To finally close, and before even a single movie has been released by the newly formed company, there is already serious conversation that another Legacy studio may be in full-on procedure again.
Wall Street Journal reported Thursday that Paramount Skydance was preparing a majority that bid for Warner Bros. Discovery -A offer supported by David Ellison and his Uber-rich Father Larry Ellison-that would seem to buy the entire WBD, including its film studio, its library and its cable network.
WBD -LAGER Skyrocketed after the report, but the immediate feeling is that this deal would be difficult to actually understand – or even come to works. Warner Bros. And Paramount is two of the last heritage big studios from Hollywood’s golden age, and combining them under a corporate roof may seem almost impossible to understand (and also a little rough).
Look, we’ve been on this road before, and M&A activity is just a couple for the course. Disney bought Fox’s film Studio, Amazon bought MGM, Warner Bros. Have changed hand from AT&T to Discovery, and this will not be the last mega fusion or transaction to shake up the business.
And there is also no guarantee that this is happening. Companies kick the tires on offers all the time, other buyers show up, things fall through. Just look at how Long and extended the agreement Paramount-Skydance was in the first place.
A sale by Warner Bros. Discovery has also been on the table for a long time, but selling it to another Legacy studio that literally just turned up and has not put their agenda not yet on anyone’s bingo card. And it has left us some questions.
First is to be, wait, What? Below are the others.
How is this even legal?
Wouldn’t this be a monopoly? Wouldn’t a company of the combined size of Paramount/Skydance + Warner Bros. Discovery set up alarm bells? There is no doubt that part of this size would be the subject of review of the Justice Department, and it is difficult to know how this administration would behave towards such a move, given that Paramount/Skydance business did not even go through until CBS News decided President Trump’s trial against it and the new owners went on that
How would Trump react to his administration now deciding CNN’s fate? (Remember when people like WBD -VD David Zaslav believed that a Trump administration would be moreNo less favorable, to M&A?)
One of the large hedges Paramount and Skydance would probably have no worrying about is the FCC. It would be a big no for a media -konglomed to own one, without two Consignment channels. But think of the latest story: NBCUNIVERSAL has had no problems running both MSNBC and NBC and Fox that run Fox News and its FOX broadcasting channel.
What can happen to HBO Max?
David Ellison has already clarified his priorities about streaming, both to drastically improve the underlying technology of Paramount+ and also combine Paramount+ with its free, AD-supported Pluto TV. To do so would attract more users and reduce the costs of having to use two separate currents.
If you add HBO MAX In the mix and treat each service’s subscribers as apples on apples, they would 77 million subs on P+ in combination with 125 million over HBO Max, Discovery+ and HBO’s linear channel better help it compete Netflix 300 million+ subscribers and a newly received Disney+ which now includes Hulu and Hulu and Hulu and ESPN.
But if Ellison is about consolidating, do they really need two (or three or four) streams? Disney is already Sunset the standalone hulu app and integrate it into Disney+ as a tileSo to imagine a paramount+ where there is an HBO tile and discovery beside them for Showtime and Pluto can be as this is on the way.
HBO as a brand in itself is too valuable to discard, something WBD realized When they literally put “HBO” Back under the name “HBO Max” after a monumentally stupid decision to remove it. But what use would Paramount and Skydance have for it?
How about TCM?
This one is harder and sadder to think about. Maybe it helps the Library of TCM to be able to have WB classics along with Paramount easier, but TCM is an anomaly on this day and age when cable networks already have declining value. It is a channel without advertising that only plays old movies. When Indieview led the fee to raise a stink that TCM disappeared Under David Zaslav’s clock, Zaslav himself gathered to keep it because he is an old -fashioned movie wonk.
Would David Ellison have the same level of nostalgia for the channel? Paramount has held on with its cable channels, but who knows if this would continue to be one of them.
Why does Paramount want both the film studio and the cable network?
Perhaps the most curious details about the Wall Street Journal’s report is that Paramount Skydance would look to buy all of WBD and not just half of the business. Cable network CNN, TBS, TNT, Food Network, HGTV, Discovery and more are not worth what they once wereand zaslav this summer announced plans to divide the company into twoEffective to go back to a structure before Discovery combined its cable channels with Warner Bros. Movie Studio.
By dividing them, it makes the more valuable part – the studio and the library – more attractive to other buyers. You could see Apple or Amazon or another technical giant get involved and not have to burden with the cable ducts hanging on a thread. Private capital can also get involved and further divide the company into parts.
Paramount may have a need for the cable network to be a Behemoth together with Comedy Central and MTV, and it would probably like to combine WBD’s many sports law with their own. But even if it would cost a fairly penny – at least $ 41 million plus $ 35 billion in debt – Ellison has advice and can potentially come before other bids as part of a bid war by diving into the pool early.
Job?!?!
When we reported on the Paramount/Skydance business initially, we claimed that it was a better case a better case to get a guy like Ellison who is responsible for having private equity purchases of private equity purchases. Or even Sony absorbs everything. It meant fewer redundancies regarding studio parties, talent and movies and shows that can be made.
With an arrangement like this, all bets would be off. Paramount during Skydance is currently planning $ 2 billion in cost cuts, which has been reported to result in 3,000 jobs losing.
A combination with WBD would probably mean a whole wave of managers who would be out. Warner Bros. Pictures and Paramount images can easily fall under an umbrella, as well as CNN and CBS News and the entire cable. Would they need two parties to use from? How many more jobs would be on the chopping block?
But at least Superman was finally able to do a crossover with the transformers.
