Ellison’s WBD: AI, Streaming & the Future of Hollywood | Vanity Fair

The entertainment landscape is bracing for a seismic shift. Paramount Skydance, led by David Ellison, has emerged victorious in the bidding war for Warner Bros. Discovery, a deal valued at a staggering $110.9 billion. But beyond the headline figure, a complex question looms: is this consolidation a strategic “force multiplier,” as Ellison insists, or a risky gamble reminiscent of the ill-fated 2006 Paramount Pictures overhaul – a period some in the industry wryly refer to as “Flyboys all over again”? The merger, still pending shareholder approval and regulatory review, promises to unite iconic brands like CBS, Paramount+, HBO, and CNN under one umbrella, but also raises concerns about debt, creative control, and the impact of artificial intelligence on the future of storytelling.

The scale of the potential empire is immense. The combined entity would boast nearly 200 million streaming subscribers, pitting it directly against industry leader Netflix. HBO Max, with its nearly 130 million subscribers and critically acclaimed series like “The Pitt” and “Heated Rivalry,” would join forces with Paramount+, home to franchises like “Mission: Impossible” and “Star Trek,” as well as recent hits like “1923” and “Landman.” But the deal isn’t simply about subscriber numbers. It’s about intellectual property – a treasure trove of film and television rights that Ellison is betting he can unlock with a combination of traditional Hollywood savvy and cutting-edge technology.

The AI Equation: Tool or Threat?

Ellison’s vision centers on leveraging artificial intelligence, not as a replacement for human creativity, but as a “force multiplier.” This assertion is crucial, as it directly addresses the anxieties of the Writers Guild of America (WGA) and the Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA), who are currently engaged in contract negotiations. These guilds will be looking for concrete guarantees that AI will be used to *assist* artists, not to supplant them. The terms of that agreement will be pivotal in shaping the future of the industry.

Larry Ellison, David’s father and the co-founder of Oracle, is a particularly enthusiastic proponent of artificial general intelligence (AGI), investing heavily in Oracle data centers. As John Coogan, cohost of the TBPN podcast, observed in Vanity Fair, the Ellisons are pursuing a dual strategy: acquiring the past (intellectual property) while simultaneously investing in the future (AI technology). Coogan characterizes this approach as placing bets that are both “long slop and anti-slop.”

A 30-Film Slate and the Awards Season Question

With the combined resources of Paramount and Warner Bros. Discovery, Ellison has promised an ambitious output of 30 films per year, all receiving full theatrical releases. This commitment is a significant departure from the recent trend of streaming-first releases and could signal a renewed emphasis on the traditional moviegoing experience. But, the success of this strategy hinges on the quality of those films. Paramount’s 2025 box office performance was lackluster, failing to land a single film in the top 10 grossing releases.

Despite this, industry insiders remain cautiously optimistic. A veteran awards consultant, speaking anonymously, suggested that box office success is the primary driver for awards consideration. “People don’t always lead with their chin about awards,” she said. “The movies have got to open and craft money for these guys with their business model, and then go from there.” Interestingly, Paramount disbanded its awards team in the fall of 2025, but the possibility of rehiring or outsourcing those roles post-merger remains open.

Debt, Layoffs, and the Saudi Connection

The acquisition is not without its financial risks. Paramount Skydance is financing the deal through a substantial amount of debt, a strategy that has raised concerns among former regulators. Alvaro Bedoya, a former Democratic FTC commissioner, told Vanity Fair that private equity deals often lead to layoffs as a means of “cleaning up” the balance sheet. Paramount representatives, however, maintain that job cuts will be minimal, with synergies achieved through efficiencies in six key areas.

Adding another layer of complexity is the financial backing from foreign investors. Last year, Paramount secured $24 billion from Saudi, Qatari, and Abu Dhabi sovereign wealth funds. More recently, reports surfaced that China’s Tencent is considering a further investment of several hundred million dollars, a claim that Paramount representatives dismissed as a “rumor.” Given Paramount Skydance’s market cap of around $12 billion, even a relatively small investment from Tencent would represent a significant stake in the company.

Free Speech Implications and the CBS News Shift

The consolidation of news operations under the Ellison umbrella also raises concerns about journalistic independence. Under Ellison’s leadership, CBS News has already undergone significant changes, including the controversial cancellation of “The Late Show with Stephen Colbert,” which some attributed to pressure from FCC Chairman Brendan Carr. Following the Paramount purchase, Ellison reportedly “made additional pledges to the FCC’s Carr to win support,” according to NPR.

Perhaps most notably, Ellison appointed Bari Weiss, the founder of the right-leaning site The Free Press, as the modern editor-in-chief of CBS News. This move has fueled speculation about a potential shift in the network’s editorial direction. The implications of this shift for CNN, another major news organization now under the Ellison umbrella, remain to be seen.

What Comes Next: Regulatory Hurdles and Contract Negotiations

The path forward is not without obstacles. The merger still requires shareholder approval and faces a potentially rigorous regulatory review. Antitrust concerns are likely to be a major focus, as regulators scrutinize the potential impact of the consolidation on competition in the media industry.

Simultaneously, Paramount Skydance will be engaged in crucial contract negotiations with the WGA and SAG-AFTRA. The outcome of those negotiations will determine how AI is integrated into the filmmaking process and will have a profound impact on the future of creative work in Hollywood. The next few months will be critical in shaping the future of this newly formed media behemoth, and whether it truly becomes a “force multiplier” or a cautionary tale of ambition, and debt.