Arizona Attorney General Kris Mayes, along with 11 other attorneys general, sued to stop a proposed $110 billion merger between Paramount Skydance and Warner Bros. Discovery. While the deal was cleared by federal antitrust investigators, the states’ lawsuit claims it would stifle competition and drive up costs for audiences at home and in the movie theater.
Paramount has blasted the lawsuit, saying the merger would allow for better competition. The company also noted 15 international regulators, along with the United States, approved its purchase.
Bill Goodykoontz, “The Arizona Republic” media columnist, joined “Arizona Horizon” to discuss the ongoing legal saga.
Goodykoontz said the proposed merger is ultimately about consolidating control over some of the country’s largest entertainment and news organizations, including CNN, CBS, HBO and TCM.
“They want to sort of run this thing through so they will control what seems like an inordinate amount of entertainment and news,” Goodykoontz said.
He said the merger would likely result in major job cuts as the companies eliminate overlapping operations, a key concern raised in the states’ lawsuit. According to Goodykoontz, California, which is leading the legal challenge, argues the merger would have a catastrophic impact on employment throughout the entertainment industry.
Goodykoontz also said the companies’ combined debt could reduce investment in movies and television programming, particularly mid-budget and independent productions.
“If you are making fewer projects, fewer people are making them,” Goodykoontz said.
He also expressed concern about the future of television news, pointing to recent leadership changes at CBS News and speculation that similar changes could occur at CNN if the merger is completed.
For viewers, Goodykoontz said the effects may not be immediate, but fewer competing studios could eventually mean fewer entertainment choices.
“I think in terms of entertainment, probably eventually have fewer choice because less product is being made,” he said.
If the lawsuit succeeds, Goodykoontz said Warner Bros. Discovery will likely continue searching for another partner, as media companies continue pursuing mergers to compete in an increasingly streaming-focused entertainment industry.
