fear that a consolidation<\/a> between two major players in Hollywood could further decrease production and lead to the sweeping job cuts that typically occur after big corporate acquisitions. Many have pointed to the downsizing that followed Walt Disney Co.\u2019s $71-billion purchase in 2019 of much of Rupert Murdoch\u2019s Fox entertainment assets. <\/p>\nMore than 4,000 people lost their jobs, according to industry sources. As part of the tie-up, Disney dramatically scaled back the staff and movie pipeline at the once prolific 20th Century Fox movie studio and eventually folded much of Fox\u2019s TV production operations into an ABC-led studio. A parade of film executives shuffled out the door.<\/p>\n
\u201cWe\u2019ve seen this play out,\u201d said Kevin Klowden, an executive director at the nonprofit Milken Institute Finance. \u201cIt\u2019s going to happen again.\u201d<\/p>\n
Discovery\u2019s takeover of the Warner assets in 2022 also prompted successive rounds of layoffs, and the Larry Ellison family\u2019s purchase in August of Paramount has prompted more than 2,000 job cuts.<\/p>\n
Both Netflix and Paramount have told Wall Street analysts that their takeover plans for Warner would involve cost cutting.<\/p>\n
Paramount has promised more than $6 billion in cuts over three years, Andy Gordon, Paramount\u2019s chief operating and chief strategy officer, told analysts during a Monday call.<\/p>\n
\u201cWe feel confident in our $6-billion number after doing due diligence extensively with Warner Bros.,\u201d said Gordon, a prominent former Goldman Sachs banker.<\/p>\n
Some analysts predicted that Paramount\u2019s deal, should it be successful, would lead to the elimination of at least 6,000 jobs and prompt other cutbacks that would ripple across the industry, including a decline in film and TV production and the staff to make, market and distribute programming. <\/p>\n
For his part, Paramount Chief Executive David Ellison has said a Paramount-Warner Bros. union would lead to a surge in movie production because he wants the joint studio to release at least 30 films a year.<\/p>\n
\u201cWe really view this as our deal is completely pro-competitive, it\u2019s pro-creative talent, it\u2019s pro-consumer as opposed to the combination with Netflix would give them such a scale that it would be bad for Hollywood and bad for the consumer and is anti-competitive in every way,\u201d Ellison said.<\/p>\n
Each company owns a movie studio, television production arm, more than a dozen cable channels and prime real estate. Paramount owns the storied Melrose Avenue lot and Warner has a tony campus in Burbank. The company would control both celebrity.land and CBS News and could combine operations.<\/p>\n
\u201cThis almost certainly means various types of value engineering of their operations, which probably means some form of job cuts, paring down duplicative areas and probably more of an embrace of AI and all the types of things that in Hollywood people get itchy feet about,\u201d said Columbia Law School professor Eric Talley, an expert on corporate finance.<\/p>\n
Netflix\u2019s acquisition of Warner might also lead to cuts, although not as much right off the bat, analysts said. That\u2019s because Netflix lacks a robust movie studio and television production capabilities on the scale of Warner Bros. or Paramount.<\/p>\n
\u201cNetflix is a little bit less of an automatic job-cut synergy picture because they don\u2019t have the legacy studio properties that require their own dedicated administration,\u201d Talley said. \u201cIt\u2019s a bit more like fitting two puzzle pieces together, side-by-side, rather than putting one on top of the other,\u201d such as a combination of Paramount and Warner Bros.<\/p>\n
Netflix has said its proposed takeover would lead to $2 billion to $3 billion in cost cuts, mostly in the acquisition of services and goods.<\/p>\n
\u201cThink of it as support areas of the business where there\u2019s overlap, there\u2019s also overlapping tech stacking capabilities,\u201d Netflix Chief Financial Officer Spencer Neumann told analysts in a Friday conference call. Eventually, there would be cutbacks in programming costs, \u201cbut that\u2019s not the bulk of the savings,\u201d Neumann said.<\/p>\n
Because Paramount wants to buy all of Warner Bros. Discovery, including its cable channels, unlike Netflix, which only wants Warner Bros. film and TV studios and HBO, there are expected to be more cuts.<\/p>\n
Netflix executives have portrayed the deal as a job creator, saying the company\u2019s original productions have employed 140,000 people from 2020 to 2024 and that it has used 500 independent production companies to make about 1,000 original projects. <\/p>\n
Netflix is building a studio in New Jersey, as well as expanding its operations in New Mexico and its film base in Hollywood.<\/p>\n
\u201cBeyond just the jobs, we\u2019re also producing \u2014 we\u2019re also investing in the entertainment ecosystem,\u201d company co-Chief Executive Ted Sarandos told investors at a UBS investor conference Monday. <\/p>\n
\u201cIn the offer that Paramount was talking about today, the Ellisons were talking about $6 billion of synergies. Where do you think synergies come from? Cutting jobs,\u201d Sarandos said. \u201cSo we\u2019re not cutting jobs. We\u2019re making jobs.\u201d<\/p>\n
However, industry analysts predicted that if Netflix absorbs Warner, the labor-intensive business units would undoubtedly be scrutinized and could ultimately be downsized. <\/p>\n
\u201cThere might be great advantages for those on Wall Street but I\u2019m greatly worried about the middle-class workers in the industry,\u201d said Daniel Green, a former TV production crew member who now directs a masters program on entertainment industry management for Carnegie Mellon University. \u201cPeople who are below the line are already suffering.\u201d<\/p>\n
Hollywood still hasn\u2019t fully recovered from the effects of the COVID-19 pandemic emergency, which stymied production and temporarily shut movie theaters, a move that inadvertently changed audience viewing habits and encouraged them to watch more films from home.<\/p>\n
There was a temporary reprieve during the so-called peak-TV era, when studios poured money into making shows and movies for their streaming services to build up their platforms in a bid for viewership. But the flurry of activity stopped as those platforms lost money and studios chose to cut back.<\/p>\n
Then came the dual writers\u2019 and actors\u2019 strikes in 2023 that put a damper on production again. <\/p>\n
This year alone, Disney, Warner Bros., NBC News and Paramount laid off workers.<\/p>\n
The contraction in the Southern California\u2019s bedrock entertainment industry \u2014 further fueled to the flight of production to cheaper locales \u2014 has contributed to a massive economic hit to California<\/a>, which had the most layoffs of any state through October, behind only Washington, D.C.<\/p>\n\u201cIn L.A., where Hollywood\u2019s already reeling … the next phase in all of this is looking at what other shoe is going to drop,\u201d said Klowden of Milken Institute Finance.<\/p>\n
For now, the outcome is in flux.<\/p>\n
Paramount offered Warner shareholders $30 in cash for all outstanding shares \u2014 a $77.9-billion expenditure. Paramount\u2019s deal requires $41 billion in equity, backstopped by Larry Ellison\u2019s family and RedBird Capital Partners, according to a regulatory filing. Joining with an ownership stake would be President Trump\u2019s son-in-law Jared Kushner\u2019s investment firm, Affinity Partners, and sovereign wealth funds from Saudi Arabia, Abu Dhabi and Qatar.<\/p>\n
Paramount said in its regulatory filings that the Middle Eastern funds would forgo having a say in the media company\u2019s operations.<\/p>\n
Paramount would also need more than $60 billion in debt financing. Apollo Capital Management, Citigroup Global Markets and Bank of America have agreed to step up to finance the debt.<\/p>\n
That would leave the company saddled with billions more in debt than David Zaslav inherited when his smaller Discovery took over WarnerMedia in 2022. That debt came, in large part, from a $43-billion dividend that Warner Bros. Discovery paid AT&T to exit. <\/p>\n
\u201cWe want to bring our proposal directly to WBD shareholders to evaluate a clearly superior proposal across both economic value and regulatory certainty,\u201d David Ellison said on Monday\u2019s call. \u201cThey deserve that choice.\u201d<\/p>\n
Netflix has said it intends to fund the transaction through a mix of cash on hand, new debt financing and its stock, which would leave it with less debt. <\/p>\n
Netflix\u2019s bid is 84% cash and 16% stock.<\/p>\n
But analysts wonder whether either company will be able to steer the deal through regulatory approvals in the U.S. and abroad.<\/p>\n<\/p><\/div>\n
\u2018 The preceding article may include information circulated by third parties \u2019 <\/em><\/p>\n \u2018 Some details of this article were extracted from the following source www.latimes.com \u2019 <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"Employment in Hollywood has already been bleak. But with the impending sale of Warner \u2014 whether its the whole company to Paramount or the studios, HBO and HBO Max to Netflix \u2014 that picture could become even dimmer. Industry workers fear that a consolidation between two major players in Hollywood could further decrease production and […]<\/p>\n","protected":false},"author":2,"featured_media":2193463,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_jetpack_memberships_contains_paid_content":false,"jnews-multi-image_gallery":[],"jnews_single_post":[],"jnews_primary_category":[],"jnews_social_meta":[],"footnotes":""},"categories":[25172],"tags":[],"class_list":["post-2193462","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-entertainment"],"jetpack_featured_media_url":"https:\/\/celebrity.land\/en\/wp-content\/uploads\/2025\/12\/Hollywood-has-already-faced-steep-job-cuts-The-Warner-deal.com2Fe92F532Fe592ebcc462b8da7b8afa7ca.jpeg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/posts\/2193462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/comments?post=2193462"}],"version-history":[{"count":1,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/posts\/2193462\/revisions"}],"predecessor-version":[{"id":2193464,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/posts\/2193462\/revisions\/2193464"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/media\/2193463"}],"wp:attachment":[{"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/media?parent=2193462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/categories?post=2193462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/celebrity.land\/en\/wp-json\/wp\/v2\/tags?post=2193462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}