Steve Marshall, attorney general for Alabama, called for California to allow Paramount’s acquisition of Warner Bros., chalking Rob Bonta’s lawsuit down to politics rather than antitrust justice.
In an op-ed for the Washington Post, Marshall contrasted his opposition to Netflix’s bid to acquire Warner Bros. with Paramount’s, saying one would have stifled competition while the other will invigorate it.
“This case is more about politics than law. Paramount CEO David Ellison wrote that he believes opposition to the deal is fueled by concerns about the political direction in which he would take CNN, which is owned by Warner Bros,” he wrote. “The attorneys general who brought the case appear to be so fixated on preserving CNN’s liberal bent that they would kneecap an effort to revitalize Hollywood.”
Marshall also noted that the lawsuit plays well with Hollywood activists while keeping below-the-line crew members from potential work the longer that the lawsuit continues.
“Beginning after Sept. 30, Paramount is contractually obligated to pay roughly $650 million per quarter to Warner Bros. shareholders until the merger closes,” he noted. “That money could have funded movie and TV show productions that drive employment in California and elsewhere in the United States. That is the cost of valuing a political win over workers and families.”
Marshall said that he originally joined at least 10 other attorneys general expressing concerns about Netflix’s acquisition of Warner Bros. because of the high level of market share the company enjoyed.
“This year, I joined 10 other attorneys general with serious concerns about Netflix’s bid to purchase Warner Bros.’ studio and streaming assets,” he wrote. “One company would have owned streaming services with a combined subscriber count of roughly 450 million worldwide — more than double the subscribers of its nearest video-only streaming competitor. That would not have been competition. That would have been a potential monopoly.”
“The Paramount acquisition is different. Unlike Netflix’s bid, Paramount plans to purchase the entirety of Warner Bros. — debt, cable networks and all. The combined company will have roughly 220 million streaming service subscribers worldwide, well below Netflix’s 325 million. The merger will create a competitor that can challenge Netflix’s lead,” he continued.
“Paramount has offered three-year agreements to AMC Entertainment Holdings Inc. and Cineworld Group’s Regal Cinemas, the world’s two largest theater chains, requiring it to release the films exclusively in theaters for at least 45 days, according to the people, who asked to not be identified because the agreements are private. The films would also not be available to stream online for at least 90 days,” it added.
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