A federal judge approved a settlement allowing Paramount Skydance’s $111 billion merger with Warner Bros. Discovery on Wednesday.
The settlement – which came after a lawsuit led by California Attorney General Rob Bonta – included concessions made by Paramount to mitigate some of the merger’s adverse effects. However, the harms alleged in the lawsuit – including monopolistic structures, higher consumer prices and reduced creative content – remain.
A report released by the Los Angeles County Department of Economic Opportunity found that Paramount’s merger will threaten 4,500 LA production jobs and $2.78 billion in economic value.
In light of these alarming figures, California and LA must remain committed to fostering a competitive film industry to protect creative talent – including aspiring UCLA artists – and consumer choice.
The merger will lead to major staff cuts at Paramount and Warner Bros., said Tom Nunan, a continuing lecturer at UCLA’s School of Theater, Film and Television and a former network and studio president.
“They call it eliminating redundancies,” Nunan said. “The people who are being let go call it getting fired.”
This latest merger comes just a few years after The Walt Disney Company merged with 21st Century Fox and after Paramount itself merged with Skydance. With each merger, thousands of workers lost their jobs.
LA has a notoriously competitive labor market, and the merger could jeopardize the futures of thousands of entertainment industry workers. The trend of consolidation in the film industry has made it harder for new writers and artists to break through.
As a result of consolidation, there are simply fewer jobs available. Established creatives can find work, but aspiring artists face intense competition to land stable roles.
For students at UCLA hoping to go into the film industry, the trend of corporate consolidation combined with other factors like the adoption of AI have left students worried about their future in the industry, said Rustin Jafarkhani, the co-events coordinator for Bruin Film Society.
“The general opinion is one of pessimism,” said Jafarkhani, a second-year molecular, cell and developmental biology student.
There are some advantages to consolidation. For one, Paramount’s streaming platform will acquire all of HBO Max’s content. It will also gain the rights to produce new media using iconic franchises like the DC Universe and Harry Potter.
For consumers, this could mean more streaming options on one platform. But at the same time, creative output may suffer.
“When there are ownership changes, the people who are in charge of programming or greenlighting movies have to step much more carefully,” Nunan said. “It’s that uncertainty that permeates everything, and that doesn’t bring out the best creatively.”
Although there are benefits to the merger, they are primarily to Paramount itself. The profits of one single company should not be prioritized over the livelihoods of thousands of workers across LA and California, including UCLA students and alumni.
In addition to clearing the deal, the Department of Justice filed a legal brief supporting Paramount amid pending litigation.
“There were 12 states, California being one of them, that decided that they were not happy with the outcome, DOJ’s decision not to bring a case to stop the merger,” said Jennifer Dixton, a lecturer at the UCLA School of Law and a former federal antitrust prosecutor. “They brought the case on their own, and they can do that basically almost as a private plaintiff, suing on behalf of the citizens in their state.”
This show of support from the executive branch, even in the face of states’ opposition, could signal to companies that the Trump administration will act charitably toward future mergers. It could also accelerate the consolidation of other California industries, especially technology, which may threaten jobs statewide.
This merger should not have been approved. Corporate consolidation makes it harder for the next generation of talented and diverse creatives graduating from UCLA to create art. It leads to a monopolized and stagnant film industry and cuts thousands of well-paying jobs.
California and LA must push back against anticompetitive mergers in the future.
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