NPR.
It is a high stakes enemies to lovers' story with enough political and corporate intrigue
“to satisfy the most discerning of drama fans, and it's not over yet.”
We are, of course, talking about paramount skydances proposed $110 billion takeover of
Warner Bros. Discovery. There was a time in this saga when it looked like Netflix would emerge victorious. Warner Bros. kept refuffing paramount offers, and then, last week, Netflix was out. Warner Bros. accepted Paramount's bid. This is the indicator for Planet Money, I'm Adrienne Ma, and I'm Whalen Wong.
If the deal goes through two legendary Hollywood studios would merge. CNN would be in the hands of Paramount CEO David Ellison, the son of a tech billionaire and an ally of President Donald Trump, and the HBO Max streaming service would probably get renamed again. So today in the show, we break down the basics of this Hollywood corporate marriage.
Who is David Ellison? What does he want?
“And how might this deal reshape our polarized media landscape?”
Plus, we learn about a unique maneuver that Paramount is using to try and gain speedy government
approval in the U.S. Today, we are bringing on a marquee name to help walk us through the Paramount Warner Bros. Deal. I'm Dave Folk and Fletk, I cover the media friend PR. Hi, Dave, you're having a very busy few weeks here.
Why, anything come up? No, no, why are we here? Dave has been busy writing about another David, David Ellison, chairman and CEO of Paramount Skydance. Can you give us the TV guide capsule summary of what we need to know about Mr. David Ellison?
Sure, and TV guides not a bad place to go for it, because he's somebody who's fascinated with all things Hollywood, David Ellison is the son of Larry Ellison, one of the richest people to walk on the planet. Larry Ellison was the co-founder of the software Titan Oracle, which provides much of the digital backbone for the nation's commerce and government.
David Ellison is a young man wanted to become an actor. It didn't pan out and he started being interested in developing movies in over time with his ambition, but also definitely with his father's extraordinary immense wealth.
He was able ultimately to become a producer, and he helped being one of the lead producers
of the mission impossible franchise and top gun, and he put himself in place just a year ago with his father's financial backing to take over Paramount, which was the best known as the parent company of CBS Paramount Studios, Paramount Plus, and also cable channels like Comedy Central and Nickelodeon.
“What was his most famous IMDB acting credit before he got involved in the production?”
Oh, I knew you're going to ask me this, he had a minor role in a sort of fighter pilot movie. I'm trying to remember what it was called, but it was not to be, I don't think they were casting directors who looked that and said, "That's the guy I want in my film." That fighter pilot movie by the way is a world war one film called Fly Boys.
It came out in 2006, David Ellison pops up briefly in the trailer providing some comic relief as an American soldier. And if that movie sounds like an old fashioned Hollywood project, well, Dave says David Ellison has somewhat old fashioned ambitions. I think it is a sort of mindset and a passion and a belief set and I can be a great
leading figure of Hollywood. The goal here is scale to be a huge player. Warner Bros. currently has five times the market value of Paramount. So acquiring Warner expands David Ellison's dominion to include not just a mega movie studio, but also cable networks and other properties.
And he needed his father, Larry Ellison's money to get there. Larry Ellison came forward and said, "Looks, I'm going to put extra tens of billions of dollars backed up by my personal trust so that you know that this money is there. There are still our foreign investors, including a sovereign wealth fund of Saudi Arabia, including an Emirate Investment Fund, and these have complicated questions that attach
to them as well. Let's not forget also that Larry Ellison is sort of lead investor in TikTok U.S., David Ellison will, in a very short amount of time, have gone from his little boutique studio to potentially if regulators approve this skydance, Paramount, and Warner together. But also, layered over that, although it's separately held, our Ellison's other major
stakes in the software giant of Oracle and in the social media giant of TikTok.
These are not incidental interests.
These are all about data and consumer habits online.
“Dave tells us there's also an ideological component to this deal.”
Warner Brothers owns CNN, a network that President Trump has repeatedly attacked. The Ellison's father and son, particularly Larry Ellison, the father, is an advisor and a friend of President Trump. Trump has made clear any number of times how much he's low with CNN. The Ellison's need, the Trump administration not to intercede in court and try to block
this take over one brother's discovery, and they are allied with him, or at least are for the time being. And so that's the fear you're also hearing within CNN. They're fearful of what's ahead, they believe they'll be job cuts, and they think they could be targeted if they were to be named publicly.
There could be job cuts in other parts of the new mega corporation, too, if regulators approve the deal.
“And Paramount took an unusual step in trying to get the green light from antitrust authorities.”
That's according to Matt Stoller. He's research director at the American Economic Liberties Project. It's a nonprofit that opposes corporate monopolies, and here's how Matt describes antitrust law in the U.S.
If you're looking at a company and you're saying, "That was companies are too powerful.
You're basically right." And then it's about figuring out the relevant nerds to explain to an out-of-touch judge why that's true. The antitrust approval process has lots of nerdy details, and one of them is something called the Heart Scott Rodino process.
It's where companies involved in large mergers submit information to the government even before a deal is finalized.
“You have to tell the government, "Hey, we want to merge, and you have to give the government”
a bunch of information." And then the government has 30 days to look at that information. And if they want more, they can ask you for more.
And what's called the second request.
Matt says compiling all the documentation for this second request can take between 12 and 18 months. The government has 30 days to review the new information and decide whether to bring an antitrust case or let the merger happen. Paramount did something that is astonishing, or at least what I was told from experience
lawyers is astonishing, which is that they completed the second request before they even won the bid for Werner. Paramount said it had, quote, "substantially complied with the second request back on February 9th. That's almost a month ago.
It means that it already sent over extensive documentation to the Justice Department. Paperwork that Matt says can take over a year to pull together." At least to me, it indicates that they feel very confident that the Trump administration is not going to challenge this merger no matter what they find. And they want to close it really quickly so that the other potential entities that
might challenge it, which is to say state-level enforcers who are Democrats can't bring a challenge in time to stop the closing. It's a very savvy political move, it's very inciterate, it's very kind of nerd stuff, but it does matter. And in fact, some politicians are already speaking up.
The Democratic Attorney General in California, which is, of course, home to Hollywood, said last week that his department has an open investigation of the deal. Democratic lawmakers like Elizabeth Warren of Massachusetts and Chris Murphy of Connecticut have also expressed grievances. The deal also needs approval from European regulators and Warner Brothers shareholders.
On Monday, Paramount said it expects that vote to happen in the spring, with the deal closing by the end of September. This episode was produced by Julia Richie with Engineering by Robert Rodriguez, it was fact-checked by Sierra Juarez, kicking cannon as a shows editor and the indicators of production of NPR.
