According to information reported by Axios, the bosses of Warner Bros. Discovery and Paramount have met to discuss a possible merger between the two entertainment giants. This merger would allow the two groups to remain competitive against the big names in streaming, Netflix and Disney in the lead.
At a time when traditional TV is experiencing unprecedented decline, its main players are looking for a way to diversify their activities and remain competitive, particularly against streaming giants like Netflix and Disney+. For Warner Bros. Discovery and Paramount, asset concentration sounds like a viable solution.
Indeed, according to information relayed by the media Axios (and since confirmed by the Wall Street Journal), the two bosses of these entertainment and cinema behemoths met this Tuesday in New York. David Zaslaf and Bob Bakish, CEOs of the two groups, discussed for several hours a possible merger project.
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Warner Bros. Discovery and Paramount discuss merger
For the moment, nothing official, it would just be a first contact between the two leaders. However, the ambitions are rather serious, since David Zaslaf also spoke with Shari Redstone, the owner of Paramount's parent company (National Amusement), on the issue.
Even if the content of these exchanges remains unknown, we imagine that the two CEOs discussed the potential benefits of this merger, which could notably consist of a combination of their respective streaming servicesnamely Max (formerly HBO Max) and Paramount+.
Towards a new streaming giant?
As a reminder, Warner is at the head of the eponymous film studios, but also of the American channel CNN and the pay channel network HBO. For its part, Paramount is also at the head of a famous film studio, but also of the CBS channels and several other cable channels such as MTV and Nickelodeon. Both groups display a delicate financial situation. For good reason, Shari Restone has been considering selling Paramount for several months now, in the hope of reduce National Amusement's colossal debt.
The boss has already sold several assets such as the publisher Simon & Schuster for $1.6 billion, while she recently met with executives from Skydance Media and Activision to discuss possible takeovers. As for Warner, the merger with Discovery in 2021 threw gaping holes in the accounts, which today represent four times the gross operating surplus. By combining their strengths, Warner and Paramount could reduce their spending and at the same time create a strong new player in the world of streaming.
However, this merger would represent a new concentration in the media sector, and it is certain that the Federal Trade Commission (the American regulatory authority) will examine the project from every angle before giving its approval or not. Note that our colleagues from The Verge tried to contact the institution, in vain.