WASHINGTON—The Antitrust Division of the U.S. Department of Justice has approved the proposed $111 billion acquisition of Warner Bros. Discovery (WBD) by Paramount Skydance, says “the impact of the transaction will be to increase competition across the media and entertainment ecosystem, with benefits for American consumers and workers.”
The deal still faces possible opposition from the European Union, which has not yet concluded its investigation, from state Attorneys General. California Attorney General Rob Bonta is still reviewing the deal and could still file a lawsuit to block it, as state AGs did in the case of the Nexstar/Tegna deal, which also passed reviews by the DoJ and the Federal Communications Commission.
After an eight month investigation that involved reviewing more than 2 million documents, the Antitrust Division issued a statement late Friday June 12 noting that “based on the evidence received in its investigation that the transaction is not likely to result in harm to competition or American consumers, including with respect to: (1) streaming video on demand (SVOD); (2) linear television; and (3) studio development, production, or distribution of films for theatrical release.”
In terms of the streaming marketplace, the Division reported that the “evidence reviewed and carefully analyzed by the Division indicates that, post-merger, competition in SVOD is not likely to be harmed. To the contrary, the combined firm is likely to increase competition by offering consumers a more robust competitive alternative to the larger SVOD offerings.”
One of the more controversial aspects of the merger was its potential impact on Hollywood production and employment. “The substantial body of evidence available to the Division indicates that the transaction is not likely to harm competition in studio development, production, or distribution of films for theatrical release,” the DoJ argued in a statement. “Instead, the evidence shows extensive competition within the industry, which has generated greater output and diversity of film offerings, and is likely to continue unabated. In fact, even since the transaction was announced, the evidence shows competition for theatrical production and distribution has increased. Smaller studios have turned to innovative content development and distribution strategies to challenge traditional assumptions regarding the conditions necessary for successful theatrical release. Indeed, this remains true looking even at narrow categories like “tentpole” or `blockbuster’ theatrical production and distribution.”
The full statement is available here.
