The entertainment industry is abuzz with the news of a potential merger between Warner Bros. Discovery and Paramount Global. This merger would combine two of the media industry’s biggest players, setting off a wave of consolidation among streaming services. The discussions should be seen as a kickoff to the next chapters for Warner Bros. Discovery and Paramount Global.
Warner Bros. Discovery, a company that was once thought of as on the outs. Its streaming platform HBO Max was wildly unprofitable, and its CEO David Zaslav went around slashing budgets and mothballing content. However, thanks to improvements on its balance sheet, speculation is building that Warner Bros. Discovery could be acquisition-minded.
One potential target could be Paramount Global, whose valuation is slumping, and which could be available at the right price. Executives are confident that the deal would receive regulatory approval, despite D.C.’s active antitrust climate. Notably, Warner Bros. Discovery doesn’t own a broadcast network, which would clear an easier path than would a combination with a company like NBC owner Comcast.
A tax provision used to merge WarnerMedia and Discovery expires next year, which would legally allow WBD to explore another deal.
Zaslav told investors last month that the company’s cost-cutting measures, and debt reduction now put it in a position “to allocate more capital toward growth opportunities.”
“It’s a challenging time for service providers to make the money work,” said Elizabeth Parks, president of Parks Associates. “It makes sense that there will be a lot of consolidation in the market. We expect to see this as a strategy in 2024 for companies to grow subscriber and revenue growth.”
Relevant articles:
– Warner Bros. Discovery in talks to merge with Paramount
– What a Warner Bros. and Paramount merger would mean for your streaming budget
– Warner Bros. Discovery merger talks with Paramount Global may draw out NBCUniversal
– Is Paramount+ on Max Coming Soon? Speculation Rises that Warner Bros …