Skydance closes Warner Bros. Discovery deal as layoffs loom

Skydance has completed its takeover of Warner Bros. Discovery. Thousands of jobs are expected to go in the biggest convulsion to hit US production for decades.

David Ellison’s Paramount-Skydance has finally completed its $110 billion acquisition of Warner Bros. Discovery, Inc. (WBD), creating a combined company simply named Skydance. Thus completes a long and tortuous process that saw Netflix making a surprise and supposedly winning bid for the company in December 2025.

The new company is massive. It has two film studios, two global streaming services, CBS, HBO, cable networks, CBS News, CNN, CBS Sports, and TNT Sports, with 200+ million streaming subscribers and audiences in more than 200 countries and territories. All in all, that rakes in around $70 billion a year. However, it also has around $80 billion of debt, which is a huge figure by any estimation and means that deep cuts are on the way.

The company hopes to make $6 billion in synergy savings as it rolls technology stacks, real estate portfolios, and more together. But, as usual in these cases, it’s the people that are mainly in the firing line. Ellison warned staff in a company-wide email that "Integrating two companies will bring change, including difficult decisions that affect our workforce.” The expectation is that thousands of jobs will be lost over the next few months in Hollywood and further afield.

Here’s a quick paragraph from TheWrap that nicely captures sentiment on the ground.

“Mark Ruffalo, a vocal critic of the merger, separately called settlement a “huge win to Trump and his billionaire cronies,” while Jane Fonda said Ellison “sold people in the entertainment industry, as well as consumers of our creative work, down the river.” Another creative who spoke anonymously to TheWrap called the merger “a f–king nightmare.”

Positive spin

The coroporate-approved  flip side of that is a commitment to making and releasing at least 30 “high-quality” theatrical films annually for two years and 32 for the next three, each with a minimum 45-day theatrical window. The company has a ridiculous amount of IP covering everything from Game of Thrones to Star Trek to Harry Potter to Friends to Mission: Impossible, so expect all that to be heavily leaned into.

Agreed quotas carved out by 12 state attorneys general mean that 20% of those movies must be blockbusters and at least four of the titles must be indies.

Skydance also intends to keep both the Paramount Pictures and Warner Bros. studio lots going despite the real estate synergies, and looks set to pivot one lot to film and the other to TV and streaming. It currently makes 180+ television shows. It says it will continue to commission content from independent studios (as well as license its own content to third parties) and as part of its settlement with the attorneys general has committed to spending an extra $300 million a year on domestic production

The editorial independence of CNN and CBS News will supposedly be guaranteed by the establishment of a five-member News Editorial Independence Board, selected by Skydance, to be set up within 180 days of closing. However, Ellison’s track record at CBS, which started with installing Bari Weiss as CBS News editor-in-chief, doesn’t exactly breed confidence. Since then there have been about 100 layoffs, the race and culture unit has closed, the Evening News has been reworked, and 60 Minutes eviscerated. Veteran correspondent Scott Pelley accused Weiss of "murdering" the show. He was fired the next day.

Skydance's streaming services, currently HBO Max and Paramount+, will unify into a single service over time, which may mean the third name change in a little over three years for poor HBO Max. It is reasonable to assume that the new merged service will cost more too.

The resistance replies

Over 5000 high-profile people signed the petition at blockthemerger.com to protest the deal. The state attorneys general have won some concessions along the way, such as that extra domestic production spend and the editorial news guardrails, but no one can pretend that it’s not going to have a large and negative impact on the production sector.

Block the Merger released a combative statement on September 30 when it finally conceded that the deal was going ahead. The resistance, it seems, continues

"In years to come, we’ll be able to point to this failure to put consumers over the monied interests of corporate consolidation as the tipping-point moment for media in this country. Allowing the Paramount Skydance-Warner Bros. Discovery merger to move forward with no meaningful structural remedies will cost jobs, mute creativity, weaken independent journalism, and damage our First Amendment rights. The ripples of this merger will be far-reaching, long-lasting, and impossible to contain.

“If there is one discernible benefit to the approval of this corporate takeover, it’s that people are now wide awake and paying attention – and their anger is not going to fade away. We are going to build on this movement to stand united as creatives, policy experts, and public advocates to achieve enduring media policy change that funds and diversifies our media and safeguards its independence. We are going to ensure the government protects the interests of everyday people and prevents them from continuing to be bulldozed for those of oligarch billionaires. We are going to continue the fight.”