Rob Bonta is scrutinizing the proposed Paramount-Warner Bros. Discovery merger. A deal of this size deserves a hard look. But California risks making a mistake if it treats this as just another case of big-is-bad.
The usual objections are familiar. Big mergers can mean layoffs. They can reduce competition. While those risks are real, they are not the whole story - and in this case they are not the main story either.
Hollywood is under real strain: the industry is no longer competing mainly with rival studios in Los Angeles. It's competing with global platforms with deeper pockets as well as better data and far more room to absorb losses. The streaming era has scrambled the old model. Costs are up. Audiences are scattered. Profit is harder to find. Legacy studios are under pressure from every side.
In that market, scale is not just about market power. It is about staying alive.
That is why this deal deserves a more serious hearing than it is getting. Together, Paramount and Warner would have stronger film and television assets, wider distribution, and a streaming business better equipped to compete in a brutal market.
For California, that matters.
Entertainment is one of the state’s core industries. It supports a huge range of jobs, not just for actors and executives but for editors, drivers, caterers, technicians, contractors, and the many small businesses that depend on production. When the industry weakens, the fallout spreads quickly.
California is already losing ground. Productions have been moving elsewhere for years. Other states offer better incentives. Other countries offer lower costs. If Sacramento wants to worry about threats to Hollywood, that should be high on the list.
Critics point to projected savings and see cuts. But blocking the deal will not preserve the status quo - because the status quo is already slipping away. The real choice is not between disruption and stability. It is between restructuring now and decline later.
There is another problem with the case against the merger. Blocking it in the name of competition could make the market less competitive, not more. A weaker Hollywood does not strengthen consumers. It leaves California’s legacy studios even further behind the largest streaming and tech companies, which already enjoy major advantages in scale and capital.
In California, opposition to large corporate deals often becomes the default political position. Sometimes that is warranted. Sometimes it is not. The question here is simple: does this leave California stronger or weaker?
On balance, it leaves California stronger.
It could help keep investment, production, and decision-making anchored in the state rather than pushed elsewhere. It could give one of California’s defining industries a better chance to compete in a market that is only getting tougher. And it could do more for the long-term health of Hollywood than the kind of symbolic toughness that generates headlines but changes little.
Bonta is right to ask hard questions. He is wrong if he thinks the answer is to block the deal.
California does not need a nostalgic defense of an entertainment industry that no longer exists. It needs a practical strategy for the one it still has.
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