California Attorney General Rob Bonta is signaling a vigorous review of the proposed $110 billion merger between Paramount Global and Warner Bros. Discovery, stepping into a regulatory void he attributes to a pullback in federal antitrust enforcement. Bonta’s stance comes days after the U.S. Department of Justice settled its case against Live Nation and Ticketmaster, a move that prompted state attorneys general to pursue the antitrust battle independently. The looming Paramount-Warner deal, which would combine major studios, television networks, and news organizations, has already raised concerns among labor groups and antitrust experts.
The attorney general’s scrutiny reflects a growing trend of state-level intervention in antitrust matters, particularly as the federal government’s approach shifts. Bonta asserted that President Trump “abdicated the federal administration’s responsibilities to hold big corporations accountable to the law and protect a competitive marketplace,” leaving states to safeguard consumer interests. This comes as Paramount filed for Justice Department approval in December, initiating the regulatory review process, and a key deadline for the DOJ to raise concerns passed without comment last month, according to reports.
Bonta revealed his office has launched an open investigation into the Paramount-Warner merger and intends to conduct a “vigorous” review. He outlined concerns about the potential for a shrinking Hollywood labor market, the consolidation of streaming services – including Paramount+, HBO Max, Pluto, and Discovery+ – and the possibility of increased prices and reduced wages for workers. “There’s no industry as iconically California as the entertainment industry,” Bonta said, emphasizing the state’s vested interest in a competitive media landscape.
The proposed merger, announced late last month, would unite legendary film studios and extensive television production units, alongside prominent news organizations like CBS News and CNN, as well as numerous cable channels. Paramount anticipates potentially finalizing the deal by the end of September. Though, the path forward isn’t without debate. Makan Delrahim, Paramount’s Chief Legal Officer, argued the acquisition would not reduce competition but instead “be a huge win for the creative community,” expanding content output and creating job opportunities, particularly in Southern California.
Delrahim also noted that Paramount pursued Warner Bros. After Netflix bowed out of the bidding, citing concerns that a Netflix deal would have faced regulatory hurdles due to the streaming giant’s market dominance. Tech mogul Larry Ellison has personally guaranteed the $45.7 billion in equity needed for the transaction, while the company is also slated to grab on more than $60 billion in debt, raising concerns among Hollywood workers about potential cost-cutting measures and layoffs.
Attorney Ethan E. Litwin, a former lawyer for TV networks, highlighted the anti-competitive implications of the deal, stating, “Paramount is investing $110 billion to take out a rival… When you take out a major rival in a highly concentrated industry… you are taking out competitors for projects.”
To bolster state-level antitrust enforcement, the Progressive State Leaders Committee, an affiliate of the Democratic Attorneys General Assn., hired Rohit Chopra, a former director of the Consumer Financial Protection Bureau and former commissioner on the Federal Trade Commission, as a senior advisor in December. Chopra emphasized the increasing reliance on states to enforce antitrust laws, stating, “Our states are really the last line of defense.”
The outcome of the Paramount-Warner merger remains uncertain, with regulatory approvals still needed from the Justice Department, state attorneys general, and overseas governments. California’s investigation could lead to a lawsuit to block the takeover, or the state could join with other attorneys general to seek concessions from the companies.
As the regulatory landscape evolves, the future of Hollywood’s competitive balance hangs in the balance. The coming months will be critical as state and federal authorities weigh the potential impacts of this landmark media merger.
What are your thoughts on the proposed merger? Share your opinions in the comments below.
