Warner and Paramount CEOs Discussed Possible Merger

Warner Bros. Discovery Chief Executive David Zaslav met Paramount CEO Bob Bakish this week and discussed a possible merger between the media giants, people familiar with the matter said, a deal that would unite some of Hollywood and cable’s biggest brands.

The executives broached the idea of a deal, but no formal talks between the companies are under way, The Wall Street Journal is reporting.

Warner owns its namesake studio, cable networks like CNN, TNT, HBO and HGTV, and a streaming service, Max, that features much of that content. Paramount has its own major studio and bouquet of cable channels like MTV, Nickelodeon and Comedy Central, as well as the CBS broadcast network and the Paramount+ streaming service.

Inside Warner, Zaslav has made no secret of his interest in exploring a deal with Paramount, which could add more programming to the Max service and bring in major NFL sports rights. A deal between Paramount and Warner could face significant regulatory challenges.

Warner’s interest comes as Paramount Global parent National Amusements has been exploring a sale and has had discussions with Skydance Media and investor RedBird Capital.

The media and entertainment industry has been through several waves of consolidation in the past decade, with Warner and Paramount each participating in some of the biggest mergers. For years, CEOs in the industry have talked about the need for scale. They wanted to be big enough to demand high fees for carriage of their channels on cable systems and, more recently, big enough to create streaming services that could compete with Netflix.

But some executives say even more consolidation is necessary to simplify a streaming ecosystem where consumers have too many options—making it hard for streaming companies to find and hold on to customers. To turn profits, streaming companies have been raising prices. Paramount+ would likely be shut down as a stand-alone service and merged into Max if a deal were reached between the companies. 

An acquisition of some or all of Paramount could be a challenge for Zaslav. Warner Bros. Discovery still has a significant debt load, stemming largely from the massive 2021 merger between Discovery and WarnerMedia. 

Warner’s stock has since floundered, and the company has laid off thousands over the past 18 months and killed several high-profile TV and movie projects to save money. The Max service is still trying to establish itself, and Warner’s core cable networks, including TNT and CNN, are dealing with rating declines and a soft advertising market.