Paramount: Neither Service Can Catch Netflix or Disney
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- Makan Delrahim, Paramount's chief legal officer, sent a May 7 letter to California AG Rob Bonta defending the $111B WBD takeover as bringing "new competitive energy" to the entertainment ecosystem
- Paramount+ and HBO Max hold just 5.8% and 5.0% of U.S. SVOD viewership respectively, per Nielsen's December 2025 estimates, against Netflix (32.5%), Disney (16.7%), and Amazon (15.3%)
- Rob Bonta said the proposed deal has "red flags everywhere" and his office is examining potential for higher prices, lower wages, fewer jobs, less choice, and reduced competition
- Paramount committed to releasing 30+ films per year post-merger, with each studio releasing at least 15 and maintaining full production and distribution staff
- Combined Paramount-WBD represents about 25% of domestic box office per OpusData's analysis of 4,000 films over five years, competing with Disney, Universal, Sony, Amazon MGM, and Lionsgate
- Delrahim distinguished the deal from Disney's $71B 21st Century Fox acquisition, arguing Disney's motivation was Hulu control while Paramount's goal is increasing output to compete with larger streamers
Why it matters: California AG Bonta's review adds a second antitrust front beyond the DOJ, and Paramount's scale argument must overcome stated concerns about higher prices, lower wages, and reduced competition. The 30-film commitment is undercut by Paramount's own Q1 2026 forecast of "significantly lower theatrical revenue year-over-year."
