Insiders say the mood at CNN is “like a funeral” this week. No, not because of the asinine ban the president implemented, which CNN is robustly fighting back against. The somber mood is thanks to a different industry bombshell: the Paramount-Warner Bros. merger is going through. What was widely regarded as the last great defense began in July, when California Attorney General Rob Bonta led a coalition of 12 states in an antitrust lawsuit against the merger. Separately, the Writers Guild of America filed their own antitrust suit at the same time. It was these suits that prompted CEO David “nepo billionaire” Ellison to throw a tantrum about moving Paramount-Skydance outside of California. Well, Monday came the grim announcement that both cases had been settled. As the face of this fight, AG Rob Bonta has been trying to sell the “concessions” Paramount now has to make, but it’s clear the terms are pretty weak, including the fact that they’re only binding for five years. So Warner-owned CNN will be in Ellison’s hands as soon as early October, as will our beloved John Oliver. Jack Warner wept.
In Monday’s agreement, the states said they had secured a handful of “court enforceable” commitments from Paramount — including pledges to increase domestic film production over the next five years by spending at least an additional $1.5 billion, or $300 million per year, and commit another $47.5 million to help fund training and career development for workers displaced by the merger.
Paramount also must make good on its promise to release 30 films each year for the next two years — and 32 films in each of the three years after that. If it fails to do so, the states say it will be required to divest from Miramax Studios and pay $30 million for each missed film toward health care and retirement trust funds associated with the Writers Guild of America and other industry unions.
When it comes to cable, Monday’s settlement orders the company to negotiate deals for current Paramount-owned and Warner-owned basic channels separately for the next five years, which the states say will help keep consumer prices down. The company must also form a “News Editorial Independence Board” monitoring news operations at CBS and CNN.
Bonta said in a news conference in Los Angeles the settlement was about “protecting people’s careers, the lives they’ve built here in California, the livelihoods their families rely on,” while maintaining it was not a vote for the merger.
…Paramount previously agreed to delay its transaction well into next year so the challenges could make their way through court. But it soon called for a settlement — notably as it looked increasingly likely that the price tag for Warner could get a lot more expensive. Paramount had promised to pay shareholders “ticking” fee compensation amounting to $7 million each day the deal was not closed past Sept. 30.
Including billions of dollars in debt, Paramount’s buyout of Warner is currently valued at about $111 billion based on outstanding shares.
This sucks. I’m too mad to be more eloquent. Though the states and WGA theoretically won guardrails to keep Ellison in check, in announcing the settlements each plaintiff still stated clearly that they think the merger is a bad idea. And remember, every one of these meager terms expires after the first five years. We shouldn’t even expect much during that window. Sure, the states demanded a “News Editorial Independence Board” and included a list of stipulations for who can serve — someone with 10+ years in journalism, no more than two from the same political party, no government workers — but guess who gets to pick these members? Ellison. And according to that New York Times op-ed he penned last month, Ellison thinks everything’s going like gangbusters over at CBS News! Also, not enough outlets are talking about the fact that by Paramount’s own account, the $24 billion Qatar, Saudi Arabia, and the United Arab Emirates invested to back the purchase of Warner gives those countries a nearly 50% combined stake in the new megamergered studio. Why do I feel like we’ve just said, “That’s all, folks!” to free speech?
PS — Someone please check in on Mark Ruffalo.
Photos credit: Kay Qiao/Image Press Agency/Avalon, Roger Wong/INSTARimages, Getty
This is BS. Our anti-trust laws need to be enforced. Although I know that won’t happen under the current administration.
…Hastening the demise of the American empire.