(April 13): More than 1,000 Hollywood actors, directors and screenwriters have penned a letter opposing the US$110 billion takeover of Warner Bros Discovery Inc by Paramount Skydance Corp, citing concerns about job losses and higher costs with fewer choices for consumers.
Joaquin Phoenix, Glenn Close and Adam McKay were among those signing an open letter expressing “unequivocal opposition” to the proposal, which is undergoing regulatory review in the US and Europe and will likely be scrutinised by the UK as well.
“This transaction would further consolidate an already concentrated media landscape, reducing competition at a moment when our industries — and the audiences we serve — can least afford it,” according to the letter. “The result will be fewer opportunities for creators, fewer jobs across the production ecosystem, higher costs, and less choice for audiences in the United States and around the world.”
After a contentious, months-long battle, Paramount outbid Netflix Inc in February to win the deal, which will create a sprawling media empire. The combined company will control two legacy studios; two streaming services, including Warner Bros’ HBO Max; two news networks in CNN and CBS; and dozens of cable channels.
Throughout the process, Hollywood unions raised concerns that a merger would result in job losses in an industry that has already seen significant layoffs in recent years.
In a letter advising shareholders to reject the bid in mid-December, the Warner Bros board said Paramount is targeting a total cost savings of US$9 billion including from its earlier merger with Skydance and the proposed acquisition of Warner Bros, which the board then argued would “make Hollywood weaker, not stronger”.
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US Senator Elizabeth Warren has also raised concerns about the deal, calling Paramount’s offer a “five-alarm antitrust fire”.
The regulatory hurdles could be costly for Paramount. The company agreed to pay a US$7 billion termination fee if regulators block the deal, as well as a “ticking fee” of 25 cents a share every quarter after Sept 30 if the transaction doesn’t close. Paramount has already paid a US$2.8 billion breakup fee to Netflix on behalf of Warner Bros.
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