Paramount Beats Netflix for Warner Bros. – What does it mean to you
In the messy and expensive battle to buy Hollywood studio Warner Bros., Paramount Skydance came out on top.
The deal comes at the end of a fierce bidding war for Warner Bros., HBO, HBO Max and several cable networks under the Warner Bros. umbrella. Discovery, which originally named Netflix as the winner back in December. But Paramount, led by CEO David Ellison and recently merged with Skydance, will not be stopped in its quest to win the day.
After a hostile takeover attempt and a massive bid of $31 a share – topping Netflix’s $27.75 offer – Paramount also offered $45.7 billion in equity personally guaranteed by Oracle’s billionaire founder, Larry Ellison, David’s father. It adds up to $110 billion, when Netflix was only offering (it seems) a small contract worth $72 billion.
Given four days to make a counter offer, Netflix finally decided to bow out. In a statement Netflix executives Ted Sarandos and Greg Peters thanked Warner Bros. CEO David Zaslav and other executives for “conducting a fair and robust process.”
It’s all a lot of numbers, a lot of statements from wealthy executives, a lot of regulatory hurdles to jump and a lot of uncertainty, especially for the thousands of Paramount and WBD employees who may lose their jobs as the soon-to-be company tries to get rid of the huge debt burden that the merger will create. And that’s only if the merger goes through — any merger of this size would require regulatory approval from the Trump administration and international governments. But many industry experts and Wall Street expect the US to go further, as Larry Ellison, the world’s second-richest person, has close ties to the Trump administration.
But what does all this mean for me and me, people who just want to watch an episode of “The Pitt” (on HBO Max) at the end of a long day? What does it mean for fans of the Superman and Batman franchises, or all of us who pay a small monthly fee for subscription services like Paramount+ and HBO Max, to be under the same management? What does it mean for the stories Hollywood will tell?
Here’s everything you need to know about the big merger, including how it could affect what you sign up to watch on your TV every night.
Is anything going to change right away because the most important thing is buying warner bros.?
Soon, consumers will not see any results. The deal has yet to be approved by regulators (more on that below), and that process could take months, if not a year. However, Paramount has already begun to announce its plans, and based on its aggressive pursuit of Warner Bros. and the win-win attitude in the press since Netflix pulled out of the bidding, expect the results of the merger to be fast and furious if and when it goes through.
Will hbo max and paramount+ be merged into one streaming service?
Yes, that’s the plan. “We plan to combine these two services, which today provide us with more than 200 million direct subscribers,” David Ellison said during an investor call on March 2.
“We think that the combined offering, given the amount of content and what we can do on the technical side, will put us in a position to be able to compete with the most advanced players” in the broadcast market, he added. (Netflix is the largest broadcaster, with more than 325 million subscribers worldwide.)
What that means is you’ll start seeing the likes of “Game of Thrones” finale “A Knight of the Seven Kingdoms” alongside “Yellowstone” spinoff “The Madison” and “Star Trek” series like “Strange New Worlds.” It will put HBO’s content next to daytime CBS content like “Survivor” and “Big Brother.”
How much will the bundled service cost? There are no indications yet from Ellison, but mergers generally do not lower prices for consumers. The trend in streaming subscription prices has pushed some services and bundles to over $20/month, and will likely continue to rise across all platforms, not just Paramount+ and HBO Max. In short: Your costs are almost guaranteed to go up.
Will hbo change? will it suddenly turn into another ‘yellowstone’ spinoff industry?
Ellison says he won’t shake things up at HBO, which is one of Hollywood’s most respected TV brands, both by viewers and industry insiders. “Our view is that HBO should always be HBO,” Ellison said on the investor call. “HBO is an asset to this business. It will continue to have the resources and independence to do what it does best.”
He added one caveat: “At the same time, we believe in licensing our content to other platforms and producing third-party content for our television studios,” Ellison added, saying, “we are committed to growing our studios and the popular shows they create.” (Ironically, those other platforms can include Netflix.)
So it looks like at least one longtime Warner employee will keep his job: Ellison gave a big shout-out to HBO Chairman Casey Bloys, who is well-respected in Hollywood and the creator of fan-favorite TV shows on the network and HBO Max like “Pitt,” “Game of Thrones,” “The White Lotus,” “Succession” and more.
What will happen to the great and warning aliens. movies made for theaters?
While Netflix was everyone’s guess it would buy Warner Bros., fans and filmmakers quickly became concerned that movies would bypass theaters entirely, as many of the streamer’s current offerings do. Now that Warner is being acquired by a rival studio, the concern is that the number of movies per year could be significantly reduced, leaving stories undefined and limiting consumer choice.
But for now, Hollywood can breathe a sigh of relief. In an investor call, Ellison said he plans to keep Paramount and Warner Bros. different movie studios, and release about 15 films each year, which would be a huge increase – in 2025, Paramount released only eight films, while Warner managed 11.
Don’t expect those movies to hit the combined Paramount+/HBO Max streaming service anytime soon, though. Ellison said he is still committed to a 45-day “window” between theater and broadcast.
What about all the cable channels, like discovery, hgtv and cnn?
When Ellison’s Skydance was merged with Paramount last year, he immediately tapped Bari Weiss, a conservative news executive, to take over CBS. His changes in the company caused him to be heavily criticized by viewers, employees and the public. We can expect a similar shift in the last word in cable news: Warner Bros.’s CNN.
Reports of panic among CNN employees are rife, not just because of the possible cuts, but because of how the new owners – who have ties to Trump – could influence the organization of their reporting and lead to the inclusion of different opinions. CNN CEO Mark Thompson sent a memo to the newsroom warning against fear mongering. “Despite all the guesswork you’ve learned during this process, I would suggest not jumping to conclusions about the future until we know more,” Thompson wrote. “Secondly, let us not forget our duty to our listeners. We are about to start a year full of amazing news in this country and overseas, which will end with the critical US mid-term elections and who knows what else. Let us continue to focus on bringing the best journalism to the millions of people who rely on us around the world.
Former CNN reporter Jim Acosta wasn’t so quiet, writing in X recently, “As I’ve been warning for a long time, America now has a media that compromises the government.”
Other WBD cable networks are likely to easily fit into the Paramount fold, though layoffs could lead to staff cuts and reduced programming.
Is it the best bros/warning. does the deal go through?
At this point it seems unlikely that anything will stop this multi-billion dollar train. Ellison recently succeeded in his Skydance merger last summer under the Trump administration, for one thing. FCC chairman Brendan Carr, who gained notoriety in September for his criticism of Jimmy Kimmel, has already signaled his approval of the WB/Paramount deal.
But the deal would need international regulatory approval, and jurisdictions like the European Union have different criteria than the US about what mergers and acquisitions can go through. David Ellison recently tried to lure officials there to keep going, according to The Hollywood Reporter.
Important/warning bros. Am I doing good or bad for you and me?
Most major mergers lower value and increase costs for consumers. Consolidation in the industry means fewer places for new and emerging artists to take their great ideas. If there are a few people who get “yes” or “no” in a certain area, a few points will make it pass. We can lose great films for the new generation without knowing that they exist in the mind of some young writer or director.
So far the deal isn’t popular in Hollywood, either. John Oliver, whose “Last Week Tonight” airs on HBO, weighed in with his signature blunt style.
“We might be getting a new corporate dad,” Oliver said at the start of his March 1 episode. “Yeah, it’s not good news. In fact, if I could quote anyone who’s ever accidentally stayed away from Roku: ‘Oh shit, I’m at Paramount now, [expletive] do I get out of this?’”
Contributor: Anthony Robledo, USA TODAY
This article first appeared in USA TODAY: Paramount beats Netflix for Warner Bros. – What does it mean to you?
Reported by Kelly Lawler, USA TODAY / USA TODAY
USA TODAY Network via Reuters Connect
