"The Warner Bros. Discovery-Paramount-Netflix drama has Hollywood in a tizzy this week - but it's missing one big thing: What about you? Americans are deep in a new era of entertainment and are increasingly likely to get their fix on YouTube and TikTok rather than with WBD's popular franchises like Harry Potter and "Game of Thrones." The headlines around the deal have focused on whether Netflix or Paramount's David Ellison will win in the boardroom. But the results in your living room will be due to forces that are much bigger than the companies themselves, and have changed the way we watch."
"The reason companies like Netflix and Paramount want to buy Warner Bros. is because competition in the entertainment industry is fierce, driven by the decline of cable TV and the rising popularity of small screens and tech companies. "If Big Tech never made a move into media, there's a very good chance we wouldn't be seeing this much consolidation as we are now," said Brandon Katz, an entertainment analyst at Greenlight Analytics. Now that Americans spend more time with the big players in entertainment like Google-owned YouTube, Netflix, and Amazon, mergers can help legacy players like Disney, Fox, and Comcast compete. It'll mean lost jobs. The combo that formed WBD led to multiple rounds of layoffs, including about 1,000 roles in mid-2024."
Viewers are shifting from traditional studios to user-generated and short-form platforms like YouTube and TikTok, reducing demand for franchise-driven releases. Cable subscriptions and theatrical attendance are declining while streaming services face higher costs and consolidated competition. Big Tech's entry into media has accelerated mergers and acquisitions as legacy studios pursue scale, prompting layoffs and restructuring. Potential buyers seek established IP to compete with digital platforms, but consumer behavior is driving outcomes more than corporate deals. Expect higher streaming prices, fewer wide theatrical releases, and diminished Hollywood leverage as technology companies shape entertainment distribution.
Read at Business Insider
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