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In the latest twist to the Paramount-Warner drama, David Ellison said that he is actively looking to relocate the company out of California in response to the lawsuit filed by the California Attorney General (and 11 others) that is intended to block the merger.
Speculation is that he is looking at Austin, Nashville or a city in one of the 38 states whose Attorney General has not joined California AG Rob Bonta’s lawsuit.
Ellison has reportedly put a deadline on this too, giving the AG until October 1 to negotiate a settlement before he begins to put the move into motion.
At stake are some 30,000 jobs, many of them from Hollywood’s already struggling “middle class” — the people who are not household names and whose ability to find work has been severely impacted by the move to streaming with its shorter seasons and less regular schedules.
Why It Matters
There has been much speculation that Ellison is bluffing, that, among other things, many of these employees would not go with him and that people with equivalent skill sets do not exist outside of Los Angeles.
And that the negative PR from the move would not be worth it for Ellison or Paramount, what with people like Evan Shapīro portraying him as a spoiled nepo-baby who likes to grab his toys and go home when he doesn’t get his way.
More than that, it seems to be such an obvious bluff that, if anything, it is going to embolden Bonta and the other AGs rather than put them off the case.
The AGs remain the last obstacle for the Ellisons, and there were some signs of movement this week as Paramount’s chief legal officer, Makan Delrahim, said that “everything is on the table,” including potentially selling CNN (currently owned by Warner Bros.), while reports of a potential oversight board within CNN seemed aimed at assuaging political sensibilities.
But bottom line is it looked like they were in the negotiating stage and so the threat to leave LA seemed doubly puzzling.
But much about the way the Ellisons have approached the deal has been puzzling, as if the laws of business don’t apply to them, so what do I know?
What You Need To Do About It
If you are Paramount, the “we’re moving out of LA thing” is not fooling anyone. Hard to backtrack now so your best bet is probably just not to mention it.
If you are Rob Bonta, you probably don’t want to go the “I double dare you!” route as the more Paramount suffers, the more people are going to lose their jobs and that will not do you any favors in Los Angeles.
If you are one of the other legacy media companies, definitely take notes on how this is all going down because they are not going to make it easy for you when your turn comes either. Much of the government is old and they think that television is stuck in the 90s when cable news networks had a lot more influence and a lot more viewers.
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