What a WBD breakup means for the Hollywood economy

Warner Bros. Discovery (WBD) is expected to spin off parts of its business with Paramount Skydance (PSKY), Comcast (CMCSA), and Netflix (NFLX) as some of the reportedly interested buyers.

Movie producer Chris Fenton says a Warner Bros. Discovery deal could have unexpected impacts on the film industry.

To watch more expert insights and analysis on the latest market action, check out more Market Catalysts.

Video Transcript

00:00 Speaker A

we just heard the investment story line behind Warner Brothers Discovery's earnings report. How about the impact of the company's planned breakup from the perspective of someone who actually produces movies and TV shows. I'm joined by Chris Fenton, he's a media executive and professor at the University of Southern California. Um, Chris, thank you for being here. So, we've been talking about, you know, what's going to happen with Warner Brothers Discovery? Will it break up? Will Paramount Skydance take it over? As somebody who sits inside the industry, all of this, what does it sort of reflect about the backdrop for the business of making entertainment right now?

00:28 Chris Fenton

No, it's a great question. I was uh fantastic to listen to those analysts talk about it from the financial perspective, but the fact is there's also a huge creative and human perspective involved with this. Um, just in the last few years, we've lost 41,000 jobs here in LA County in the entertainment business. Obviously, further consolidation will uh further mitigate the amount of jobs that are here. And then on top of it, we're looking at uh a consolidation in the creative aspect of Hollywood. Um, even if Paramount takes over Warner Brothers, you're probably going to see a downsizing in the amount of output that is put um onto the screens as far as the movie business is concerned. And if a Netflix picks up a Warner Brothers, they might actually just more pick through the library and uh do re redoes of a lot of the IP that they would acquire in such a uh situation. So, we're seeing a lot of nervousness and a lot of people really on pins and needles in terms of how this is going to play out over the next few months.

View Comments