Paramount is pressing forward with its $111 billion merger with Warner Bros. Discovery, asserting that the union is necessary to compete with streaming giants Netflix, Disney, and Amazon. Paramount's chief legal officer, Makan Delrahim, emphasized this position in a letter to California Attorney General Rob Bonta on May 7.
Paramount's Strategic Argument
Delrahim's letter addressed concerns over potential antitrust issues, highlighting the pro-competitive benefits of the merger. He stated that Paramount+ and HBO Max cannot individually match the scale and reach of larger streaming services.
According to Nielsen data from December 2025, Paramount accounted for just 5.8% of U.S. subscription VOD viewership, while Warner Bros. Discovery held 5.0%. In contrast, Netflix, Disney, and Amazon collectively captured 65% of the market.
Impact on Theatrical Releases
Delrahim reassured that the merger would not significantly alter Paramount's relationship with theater operators. He claimed that, combined, Paramount and WBD would only control 25% of the domestic box office, based on OpusData's analysis of 4,000 films over five years.
He differentiated the Paramount-WBD merger from Disney's acquisition of 21st Century Fox in 2019, emphasizing that Paramount plans to increase its theatrical releases, unlike Disney's strategy post-acquisition.
Regulatory and Market Challenges
While the merger has cleared a milestone at the Justice Department, it still requires European regulatory approval. The DOJ retains the authority to challenge the merger, with political considerations potentially influencing the review process, as noted by Omeed Assefi, acting head of the DOJ's antitrust division.
Despite these hurdles, Warner Bros. Discovery shareholders have shown overwhelming support for the merger. Paramount aims to release over 30 films per year post-merger, positioning itself as a formidable player in the entertainment industry.
Future Prospects
As Paramount endeavors to finalize the merger, it faces a complex landscape of regulatory scrutiny and competitive pressure. The company's strategy hinges on leveraging the merger to enhance its streaming capabilities and bolster its theatrical output to compete more effectively with larger rivals.
Source: https://variety.com/2026/tv/news/paramount-warner-bros-merger-hbo-max-catch-up-netflix-disney-amazon-1236745942/
