There are several people against Paramount Skydance's merger with Warner Bros. Discovery, and that's fine. I, too, find it very complicated to imagine what the future would look like if they came together. Many analysts and consumers share those same thoughts. This is fine. It always will be in any democracy.
But today, I saw an antitrust suit filed by five consumers in California that is not only seeking to block this merger... but also to reverse the Skydance acquisition? I'll be honest, I burst out laughing when I saw the headline on X (Twitter; damn it). Cause in less than a year, as Ellison became public enemy number one by attempting to purchase WB, he also caused people to make some questionable claims to block the merger.
At the start of the file, it claims that not only will the Warner Bros. merger violate the Clayton Act, but that it already did so with the Skydance merger.
The violation was preceded by Skydance Media’s $8 billion acquisition of Paramount Global, which also constitutes a violation of Section 7. That acquisition lessened competition and had anticompetitive effects, including increased prices, decreased quality, and decreased consumer choice.
This feels very uncanny, as Paramount has spent the last few years struggling to keep up with debt and may not be able to pay the NFL in the next couple of years. That outlook changed when Ellison spent the first month prioritizing growth by acquiring the rights to the UFC events (I'll question the quality of all those matches later when the rights are up) and signing the deal with Legendary. That, of course, led them to raise prices for both Paramount+ plans.
With that, Paramount also eliminated free trials for the main platform, saying that over a million users were only using it long-term by bypassing the trials. As stated in the suit, the plaintiffs felt deterred by those actions of removing the trials.
Speaking of them, only three of the five plaintiffs actually pay for Paramount+. One of the many questionable parts of the suit (which I laughed about) was that the plaintiffs were paying for multiple cable subscriptions alongside other services like Netflix and Apple TV. It begs the question of how many people actually sit down and see why money is leaking from paying for DIRECTV and Hulu + Live TV just to watch CNN.
Funny enough, those three are willing to continue paying for the service, and the other two would consider it if the prices were reduced. This is what lawyers call a monkey's paw case: to get what you want for less or free.
Most of this suit concerns the declining quality of CBS News after Ellison took over, as a condition of the Skydance merger, and the feeling that the content leaned more to the right. They claimed it diminishes its value, and adding CNN would make things worse. CBS News is shaky in its news coverage nowadays.
Paramount has spent the last few years under intense pressure, with linear and studio profits shrinking, and streaming has yet to turn a profit for them. The final years of the Redstone era felt underwhelming, and Ellison's takeover was celebrated as a fresh start for the aging studio and the other assets under Paramount. Why would they want all of these actions reversed just so Paramount would go on another bidding war?
The plaintiffs' motives are only to block the WBD merger, which will likely be consolidated into the state's lawsuit against them. But all other claims made by those consumers feel like a cash grab for not choosing their content well. In this generation of the streaming race, many of these services offer bundles, including Paramount+. P+'s essential and premium tiers (through Showtime) are available on many cable providers, but consumers aren't aware of this.
Again, I'm not writing this to support or promote the WB merger. Ellison should focus on growing Paramount itself first before taking any more studios. But claiming CBS News' change of focus on P+'s price hike doesn't merit any compensation.