Larry and David Ellison are desperate to get their unpopular $111 billion merger between Paramount/CBS and Warner Brothers across the finish line. So they’ve been engaging in no shortage of dodgy behavior to try and derail the only thing left standing in their way: the 12-state antitrust lawsuit claiming that more media consolidation is anti-competitive and will result in thousands of new layoffs.
In recent weeks the Trump-allied billionaire and his nepobaby son have taken to trying to claim all merger opponents are somehow “antisemitic,” at one point even going to far to create a fake consumer group that used AI to generate bogus support for the megadeal. They’ve also endlessly threatened to leave California if the lawsuit isn’t shelved, despite that being logistically unlikely.
This week, the company funded, and then “leaked” a study claiming that California faces imminent disaster if California AG Rob Bonta doesn’t immediately settle with Paramount.
The study, from the Los Angeles Economic Development Corporation’s Institute for Applied Economics, tries to claim that if Paramount is “forced” to leave California as the result of the lawsuit, California could see 58,000 lost jobs and up to $21 billion a year in ambiguous losses:
“Once Paramount completed the entire relocation of its headquarters and other operations out of California, the state would experience the permanent loss of approximately 28,990 to 57,980 full-time jobs statewide across all industries, and losses of between $10.6 billion and $21.2 billion annually in economic output.”
A few things. One, the news outlets that covered this story (like The Hollywood Reporter and The Wrap) either downplay or omit mentioning this study was funded by Paramount. The “Los Angeles Economic Development Corporation’s Institute for Applied Economics” also isn’t a government agency or objective entity, it’s an industry-sponsored organization designed to sound authoritative and official.
Most of the outlets played along with the idea that the study was “leaked,” when it clearly was part of a strange little stage play being put on by Paramount and a group it hired to conducted a lopsided study filled with a lot of magic math. To come up with the 57k layoffs and $21.2 billion, the study authors have to engage in an impressive amount of baseless patty cake:
“It should be emphasized that these estimated job losses include direct, indirect and induced jobs, capturing the ripple effects through Paramount’s supply chains in California as well as the economic activity of household spending,” the study says. “Consequently, the job losses pertain to all California industries rather than solely to motion picture and television production.”
Both the study and the stories make a big deal about Paramount’s promise to release 30 major brick-and-mortar films per year. But neither the study nor the coverage explore the real-world impact of the most likely outcome: that all of Paramount’s pre-merger promises are completely meaningless, and untold thousands of people lose their jobs to try and pay down deal debt.
Again, a study about the impact of the deal on California didn’t even consider what happens if Paramount isn’t being honest about the deal’s benefits.
This isn’t tea-leaf reading: higher prices, mass layoffs, and shittier overall product is literally what happens every single time there’s major U.S. media consolidation — especially whenever Warner Brothers is involved. We literally just watched it happen with bumbling AT&T executives, who were arguably more ethical and competent than anything we’ve seen out of Ellison’s Paramount.
Again that these deals are bad for workers, consumers, and markets isn’t even an opinion. There are fifty years of very clear historical evidence. Paramount is positively desperate to frame the simple act of actually enforcing antitrust law as somehow “extreme leftism” and radical, when the real radical act is U.S. policy endlessly embracing harmful consolidation with zero consideration for real world impact.
With the absence of coherent federal governance in the age of corrupt authoritarianism, there’s really very little holding Paramount’s feet to the fire in terms of pre-merger promises, which are generally meaningless. While empty promises of 30 major releases a year may have excited Tom Cruise and James Cameron, that isn’t something they can even realistically promise given market challenges.
What historically always happens is these companies (and their think tanks and assorted proxies) promise no shortage of amazing synergies, so the merger either gets rubber stamped or affixed with meaningless conditions. About a year later the mass layoffs and price hikes start, at which point all the people responsible for blowing smoke up everybody’s ass regarding the merger benefits have nothing to say about any of it, because they’re off propping up some other shitty deal.
If America genuinely valued free market innovation and entrepreneurial spirit, we’d stop rubber stamping shitty deals based on the empty promises of terrible rich people.