Paramount settles big antitrust suit, paving way for Warner Bros. acquisition

Paramount has settled a California antitrust lawsuit, removing a major roadblock to its planned acquisition of Warner Bros. Discovery (WBD).

Per Deadline, Paramount has agreed to make some concessions regarding the suit that was filed by a dozen state attorneys led by Attorney General Rob Bonta. These include separation of the studios for a period of time, guardrails surrounding the editorial independence of both Warner’s CNN and Paramount’s CBS, and financial penalties linked to CEO David Ellison’s commitment to 30 movies per year. However, The Wall Street Journal reports that Paramount won’t have to sell any cable networks.

It’s unclear if and when Paramount’s WBD buyout will close now that this critical U.S. legal obstacle has been overcome. Either way, it’s a notable development in the saga of companies vying to snatch up WBD. In December, Netflix had announced a deal to acquire the historic entertainment giant, but it backed out less than three months later due to a steep asking price. This allowed Paramount, which had been vehemently pursuing WBD, to step in and strike a deal.

Of course, this move hasn’t come without its fair share of controversy. While Hollywood was concerned with Netflix’s streaming-first business model potentially hurting theatres, many are apprehensive about a Paramount-controlled WBD for its wider political implications. In particular, the Ellisons, who own Paramount, have close ties to Donald Trump, and we’ve already seen examples of the U.S. president influencing the family, including with the planned Rush Hour 4. Foreign investors, including the Saudis, would also own roughly 50 per cent of a merged Paramount-WBD.

Beyond fears that an oligopoly involving all of these forces could impact the kinds of movies that get made, there are also concerns about Paramount owning news agencies like CNN. Given that Trump just banned CNN and other publications from the White House amid baseless accusations of them being “fake news,” it’s unclear what else he might want done to the iconic outlet should it be controlled by his close friends, the Ellisons.

And finally, it’s unclear how Paramount, which already operates its own Paramount+ streaming service, will approach WBD properties like HBO around the world. In Canada, Bell has long held the licence to many HBO shows, and the company said this content will remain on Crave “for the foreseeable future.” But of course, that agreement isn’t indefinite, so it remains to be seen what might happen to Warner Bros. titles in Canada in the long-term under potential Paramount ownership.

Via: Deadline