Paramount Skydance reached a settlement with California and 11 other states Monday, clearing a major legal hurdle in the company’s planned purchase of Warner Bros. Discovery.
But a key observer warned massive job losses will soon follow.
California Attorney General Rob Bonta announced the agreement on Monday, Sept. 21, saying the states plan to drop their opposition to the merger after Paramount made concessions meant to protect entertainment industry jobs, increase domestic film production, and purportedly guarantee editorial independence at CBS News and CNN.
Under the agreement, the company must produce at least 30 films over each of the first two years after the deal closes and 32 films annually over the following three years.
The media giant also agreed to invest $300 million a year for five years to expand film production in the U.S. The $1.5 billion investment is expected to dramatically increase the number of films Paramount produces domestically. According to Bonta, the company currently makes only about 5% of its films in the U.S.
Bonta described the commitments as “massive increases in domestic production,” and said he plans to push for an uncapped film tax credit in California, as productions flee the state.
Paramount additionally agreed to spend $9.5 million annually to support independent films and invest in entertainment industry workforce development, to increase worker training.
The settlement also requires CBS News and CNN to maintain independent editorial boards to protect newsroom decision-making after the merger closes.
Paramount Skydance CEO David Ellison said he was “excited” for the merger to move forward.
“There’s still work ahead to get this deal across the finish line, but we’re excited to bring these two iconic companies together, as it means more opportunity for our creatives, production crews and employees across the business, and more great entertainment for audiences everywhere,” Ellison said in a statement Monday.
SAG-AFTRA, the union representing actors, said it was cautiously optimistic about the settlement.
“The settlement of the Attorneys General antitrust lawsuit, announced today, addresses some of our deep concerns about production levels and investment in U.S. production,” the union said.
But Alvaro Bedoya, a former commissioner for the U.S. Federal Trade Commission, blasted the merger as a power grab by billionaires aligned with President Trump.
“Today, billionaires have yet again bribed, censored, and bullied their way to the top. As a result, a billionaire media conglomerate closely allied with the president will soon own one of its closest rivals, including some of the nation’s most critical news outlets,” Bedoya wrote on social media.
He also issued a stark warning about the future of the entertainment industry.
“Layoffs will follow,” he said. “People from L.A. to Atlanta will lose their jobs, small businesses will lose their contracts, your cable bill and movie ticket will be even more expensive. Dissent against money and power will be even harder to find.”
The agreement came after the states filed an antitrust lawsuit in July to block the merger. Joining California and New York in the legal battle were Arizona, Colorado, Connecticut, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, Oregon, and Washington.
Discover more from Urban Hollywood 411
Subscribe to get the latest posts sent to your email.
