US justice department approves $111bn merger of Paramount and Warner Bros Discovery | Trump administration
Donald Trump’s Justice Department has decided to approve the $111 billion merger of Paramount Skydance, controlled by the Ellison family, and Warner Bros. Discovery, the parent company of networks such as CNN and HBO.
The deal was approved by the justice department’s antitrust division after a months-long review and despite concerns from many in the entertainment and media industries who believed it would harm competition by reducing the number of movie studios and possibly merging two news networks (Paramount’s CBS News and CNN).
“The Division has completed its analysis of the proposed merger of Paramount and Warner Bros. and has determined, based on the evidence obtained in its investigation, that the transaction is unlikely to harm competition or American consumers, including: (1) streaming video on demand (“SVOD”); (2) linear television; and (3) studio development, production or distribution of films intended for theatrical release,” the agency said in a statement Friday evening.
While U.S. government approval would be a big win for the deal, obstacles remain. Earlier this week, the UK competition watchdog launched an investigation into the merger to determine whether it would lead to a “significant lessening of competition” in the UK. The Competition and Markets Authority (CMA) has set an August 7 deadline to determine whether the merger requires further scrutiny. European regulators are reviewing the deal as well as they are investigating the funding behind the merger; Three sovereign wealth funds in the Gulf have committed a total of $24 billion. Both reviews have July deadlines.
On Tuesday, regulators in Australia approved the deal, determining that it was “unlikely to have the effect of significantly lessening competition in respect of the wholesale supply of films for theatrical release in Australia.” according to a filing The Securities and Exchange Commission listed several other countries that have given their blessing to the merger.
Journalists at CBS News and CNN expressed concern about the possibility of merging the networks, as the companies promised $6 billion in synergies from the deal; which would likely lead to significant layoffs. There are also long-standing concerns among some employees at CNN about the possibility that David Ellison and his father, Larry, Trump’s longtime associate, would redirect the network in an editorial direction that would favor the president. (David Ellison Promised in March He has said that CNN’s editorial independence will be maintained, but there is speculation that he may choose to appoint CBS News’ embattled executive editor Bari Weiss to head the cable network.)
There is also the possibility that a coalition of US state attorneys general could file a lawsuit to block the merger. reportedly It will take place over the next few weeks and will likely be led by California attorney general Rob Bonta.
Policy first reported He said Trump’s justice department had decided to approve the merger.
“Over the course of a rigorous eight-month investigation conducted by the Division’s career staff, the Division received more than two million documents from more than 80 custodians from the Parties, a significant amount of data, as well as extensive documentation, data, and advocacy from third parties across the media and entertainment ecosystem,” the justice department said.
Opponents of the deal have criticized reports of the Trump administration’s decision to approve the long-awaited merger.
“For all the talk of conducting a thorough investigation, the solution was with the Trump Justice Department all along,” Free Press co-chairman Craig Aaron said in a statement. “Paramount Skydance made major changes to its newscast, touted and promised to win management approval, despite evidence that giving so much media power to one company—all movie studios, cable channels, and newsrooms—would undermine competition, destroy jobs, distort the news, and endanger our democracy.”
Aaron also called on state attorneys general to take action and file lawsuits to try to stop the merger: “The attorneys general have the evidence they need to stop this deal; now the public needs action.”
Democratic Senator Elizabeth Warren, who has openly opposed the deal he said in a social media post. He said Friday the approval was “terrible news for every American who doesn’t want billionaires close to Trump to control what they watch and how much they pay,” adding that the merger “reeks of corruption and influence peddling.”
