A merged Paramount-Warner Bros. Discovery would carry $79 billion in debt, and that number explains why the fight over the deal has moved from studio lots to the DOJ Antitrust Division.
Paramount Skydance’s top lawyer, Makan Delrahim, accused Netflix of running a “panic-level” campaign to turn regulators and other stakeholders against the transaction, according to Ars Technica. Netflix’s response was one word in spirit: “Absurd.” The clash signals something bigger than corporate sniping. The next phase of streaming consolidation is being fought through labor claims, content-spend math, debt fears, and regulatory framing before the DOJ decides what market power even means here.
Paramount turns the WBD deal into a Washington knife fight
Paramount’s June 5 letter went to Jared A. Hughes, acting section chief of the DOJ Antitrust Division’s Media, Entertainment, and Communications Section, and A. Maya Kahn, a trial attorney in the division. That audience matters. Paramount isn’t just rebutting critics. It’s trying to define the transaction before regulators do.
Delrahim’s central claim is that Netflix sees Paramount as a more serious rival if it can combine with Warner Bros. Discovery. His language was deliberately combative.
“Indeed, Netflix’s panic-level response and scorched-earth campaign to try and poison regulators and other stakeholders against the Transaction shows just how seriously Netflix takes Paramount as a scaled competitor.”
XOOMAR analysis: Paramount is trying to flip the antitrust story. Instead of defending a large merger from scrutiny, it wants regulators to see opposition as self-interested behavior by a dominant streaming rival. That doesn’t prove Netflix did anything improper. It does show Paramount understands the merger review will turn on narrative as much as numbers.
The Netflix allegation is explosive, but thin on public evidence
Netflix rejected the charge. A spokesperson told Politico, per Ars Technica:
“We walked away from this deal months ago and remain focused on our own business, not theirs. Ultimately, it’s up to the regulators to approve this deal and determine if it is in the best interest of the industry and all concerned.”
That statement does two things. It denies the premise and pushes the decision back to regulators. It also avoids engaging with Paramount’s “poison regulators” phrase, which is the kind of language that can dominate a merger fight if repeated often enough.
The source material does not detail what specific actions Netflix allegedly took. Paramount says Netflix tried to influence the Teamsters and other stakeholders, but the public record described here does not show evidence of misleading claims, secret coordination, or improper conduct.
That distinction matters. Competitors often have views on mergers that could affect them. The question for regulators is not whether Netflix dislikes the deal. It’s whether the merger harms competition, workers, consumers, or content markets under the facts in the record.
Teamsters pressure gives Paramount a labor problem
The immediate trigger was a March letter from The International Brotherhood of Teamsters, which has 1.3 million members. The union asked the DOJ to block the deal “unless substantial and enforceable safeguards are put in place to increase domestic production and protect jobs.”
Paramount’s response is built around production volume. Delrahim argued the merger would “not reduce work opportunities for the Teamsters or other organized labor” and would lead Paramount to make more content for streaming services, broadcast TV channels, and theaters.
He pointed to Paramount’s post-Skydance activity in 2025 as evidence. Since that merger, Paramount has either bought or renewed 20 shows and “will nearly double its theatrical output this year as compared to 2025,” Delrahim wrote.
Paramount’s strongest labor-friendly line was blunt:
“More films and series in production means more call sheets, more location days, more transportation, casting, and catering work.”
That is the case Paramount wants the DOJ to hear: more scale means more output, and more output means more work.
The content-spend math cuts both ways
Paramount’s promise has a complication. In a January SEC filing, Paramount said the combined company expects to spend less on content. The reduction would be less than 10 percent, and the filing said none of the reductions would come from “film/TV studios.”
That lets Paramount argue the cuts won’t hit the workers the Teamsters represent. But it still gives critics a clean counterpoint: a merged company saying it will spend less overall must explain why that won’t reduce opportunity somewhere in the production chain.
The company has also said the merger would produce more than $6 billion in savings. Paramount said those savings would come primarily from “duplicative operations across all aspects of the business,” including back office, finance, corporate, legal, technology, infrastructure, and real estate.
| Issue | Paramount’s argument | Tension in the record |
|---|---|---|
| Jobs | Production headcount and skilled trade labor won’t be cut | The company has said the deal would involve job losses tied to cost savings |
| Content | More films and shows mean more work | SEC filing says total content spend would fall by less than 10 percent |
| Theatrical output | David Ellison has pledged at least 30 feature films annually with at least 45 days in theaters | The source does not show how that pledge will be enforced |
| Debt | Scale can support competition | Combined company would carry $79 billion in debt |
XOOMAR analysis: This is the core credibility test for Paramount. It must persuade regulators that cost cuts and output growth can coexist. That isn’t impossible, but the burden is heavier when the same transaction is tied to savings, debt, and labor assurances.
Disney-Fox becomes the precedent both sides want to own
The Teamsters pointed to Disney’s 2019 acquisition of 21st Century Fox, saying that deal led to “eliminated production units, significant job losses, and canceled projects.” Paramount pushed back, arguing that this comparison ignores Disney’s prior changes to its feature film release strategy, the impact of the COVID-19 pandemic, and an increase in wide-release theatrical films in the US from 2019 to 2025.
Delrahim also claimed Disney increased content spend from $5 billion in 2019 to $24 billion expected for 2026, citing a 2019 Form 10-K. Ars Technica notes a problem: that filing says Disney spent $7.104 billion on film and TV production and $10.517 billion on TV program licenses and rights that year. Ars also notes analysts have pointed to Disney spending closer to $28 billion on content in 2019, which would make $24 billion in 2026 a decrease, not an increase.
That dispute is not a side issue. It shows how merger fights are fought through historical comparisons. If Disney-Fox is framed as a warning, Paramount has a problem. If it’s framed as a misleading analogy distorted by pandemic-era disruption, Paramount gains room.
Subscribers, workers, and investors face different risks
For Hollywood workers, the issue is whether a bigger buyer creates more production or fewer places to sell work. Paramount says more content is central to competing. The Teamsters say safeguards are needed before the DOJ lets the deal through.
For subscribers, the source material does not provide pricing plans or product changes. The practical concern is narrower but real: regulators will need to assess how a combined company could affect content availability, theatrical windows, streaming libraries, and bargaining power.
For investors, the record points to uncertainty around approval, remedies, debt, and whether promised savings can be achieved without weakening the production engine Paramount says it needs. The $79 billion debt figure and $6 billion-plus savings target make the financial case inseparable from the antitrust case.
The next filing may matter more than the accusation
Paramount’s claim may not damage Netflix by itself. The public evidence described so far doesn’t establish a Netflix sabotage campaign. But it does show Paramount is preparing for a messy review where labor, content spend, debt, and market definition will all collide.
The evidence that would strengthen Paramount’s case is specific: enforceable production commitments, clearer job protections, and a credible explanation of how content spending can fall while production opportunities rise. The evidence that would weaken it is just as clear: broader cuts, vague labor promises, or numbers that don’t survive scrutiny.
The DOJ does not need to decide whether Netflix is being dramatic. It needs to decide whether this merger leaves the industry better or more constrained. That’s the fight Paramount is trying to win before the formal answer arrives.
Impact Analysis
- The DOJ review could shape how regulators define market power in streaming.
- A $79 billion debt load may become central to arguments about competition and deal risk.
- The fight shows major media mergers are now being contested through regulatory narratives before approval decisions are made.
Originally published on XOOMAR. For more news and analysis, visit XOOMAR.
![Netflix Headroom: How to Cut AI Agent Costs 10x in Production [2026]](https://media2.dev.to/dynamic/image/width=1200,height=627,fit=cover,gravity=auto,format=auto/https%3A%2F%2Fdev-to-uploads.s3.amazonaws.com%2Fuploads%2Farticles%2Ff8ncam727amufd1gfwd2.png)
