"Sounds like a terrible idea": Warner Bros. Discovery and Paramount merger hits early rejection waves

Warner Bros. Discovery is in talks with Paramount on a possible merger between the two longtime giants. WB Discovery Chief Executive David Zaslav held a meeting with Paramount Global Chief Executive Bob Bakish to broach the topic. The merger, if it takes place, will be home to various media platforms which include, CNN, CBS, HBO, Paramount Plus, and Max.

Reported first by Axios, the merger aims to solve the losses incurred by the two companies and take on streaming giants such as Netflix and Amazon. Fans and viewers have reacted with surprise and reluctance at the news with some netizens calling it a bad idea.

The reactions have poured in on various social media platforms with apprehensions about the monopoly of media giants. The skeptical wave comes in the wake of both Warner Bros. Discovery and Paramount Network canceling many awaited projects.

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Netizens react with reservation on the news of Warner Bros. Discovery and Paramount merger

Warner Bros. merged with Discovery two years ago (Image via WBD)

Viewers and netizens have expressed doubts and misgivings as the first news of a potential merger between Warner Bros. Discovery and Paramount started doing rounds. Axios reported the meeting held between WB chief David Zaslav and Paramount chief Bob Bakish over lunch at Paramount’s headquarters in Times Square, New York City.

Such a union would aim to sustain the competition from the streaming services of Netflix, Prime Video, and Apple. While the possible merger will bring together two out of five big Hollywood Studios, the consumers of the streaming content are doubtful about the results of the same.

While one user called it a terrible idea, another questioned too many mergers in the company.

Some other X users are seriously questioning the move. A few netizens have shown concerns about more job cuts with such a merger between two large companies:

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Why is a merger brewing up between Warner Bros. Discovery and Paramount?

Paramount needs a partner to pull out of debts (Image via Paramount)

Both Warner Bros. Discovery and Paramount have been running through massive losses going into billions of dollars from their bulking-up streaming services. Warner has had some wise mergers in the past which include Discovery increasing its portfolio and a better cash position.

On the other hand, Paramount is under pressure to have a strategic business partner to relieve its debts accrued by streaming services in recent years. The cost-cutting approaches employed by the company have not been able to pull it out of its debts.

Paramount’s parent company, National Amusements, is held by the Redstone family, and its heiress, Shari Redstone is open to selling her stake. With the ongoing talks, the Redstone family is likely ready to consider a merger.

However, WarnerMedia’s merger with Discovery, worth $43 billion, was a move to secure tax advantages. As such, Warner Bros. cannot enter into any transaction with Paramount before April 2024, which marks the two-year end of its merger with Discovery.

While Zaslav had hinted at acquiring additional assets to boost Warner Bros. Discovery’s content on offer, investors were not happy with the merger news bringing the company stocks down by 5.7% since the news by Axios.

Considering that advertising is moving to streaming platforms, it makes sense for all media businesses to invest in these services. But even though Zaslav was successful in reducing Warner Bros.'s debt, a sizable portion still remains. Acquiring Paramount may not be able to help solve WBD’s debt issues as Paramount has $15.7 billion in debt.

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While there is no confirmation on the merger just yet, the volatile entertainment industry will force huge shifts from big players like Paramount and Warner Bros. Discovery. Consumers of content from these channels must wait for a final word.