From The Verge · Charles Pulliam-Moore · · 2m
Paramount's merger promise may be impossible to keep
Paramount agreed to release 30 movies annually after merging with Warner Bros., but its track record suggests it can't deliver without cutting corners.
In brief
Paramount agreed to release 30 movies annually after merging with Warner Bros., but its track record suggests it can't deliver without cutting corners. Paramount committed to doubling its film output as a condition of the merger, but the settlement's loopholes allow it to meet quotas by acquiring films from other…
Paramount settles merger lawsuit
Paramount reached a settlement with 12 states suing to block its $110 billion merger with Warner Bros. Discovery, clearing the path to create one of the world's largest production houses.
Paramount promises 30 films yearly
As part of the settlement, Paramount committed to releasing at least 30 movies annually for the first two years after the merger, increasing to 32 films in years three through five.
Settlement includes financial penalties
If Paramount fails to meet its annual quota in the first two years, it must pay $30 million per film into union healthcare and retirement funds. Failure to comply over five years could force the sale of its 49 percent stake in Miramax.
Current output falls far short
Over the past six years, Paramount averaged 15 films annually while Warner Bros. Discovery averaged 17. Together they'd need to nearly double their combined output to hit the 30-film target.
Loopholes allow acquired films
The settlement doesn't require Paramount to produce all films internally. It can acquire movies from other studios and rebrand them as Paramount/WBD releases to meet its quota.
Budget requirements are minimal
Only 20 percent of Paramount's films need production budgets over $50 million, meaning 80 percent could be lower-budget projects or acquisitions.
Guardrails expire in five years
The settlement's requirements only last five years. After 2031, Paramount/WBD will face no production quotas, potentially allowing the studio to consolidate and reduce output.
Settlement may not protect workers
While officials claimed the deal protects jobs, a merger of this scale typically triggers layoffs. SAG-AFTRA called it only the bare minimum standard employers must meet.
“the lowest standards that our employers must meet”
The takeaway
Paramount committed to doubling its film output as a condition of the merger, but the settlement's loopholes allow it to meet quotas by acquiring films from other studios rather than producing them internally.
