Everyone is covering the merger fight as a question of who ends up owning Warner Bros.
My insiders say the real question is whether Warner Bros. survives at all.
“The deal has to go through,” an insider tells me, “or else Warner Bros will be sold off in pieces and cease to exist or become like MGM.”
The comments came in a conversation about HBO Max’s recent copyright strikes against Cosmic Book News’ social channels, which my insider chalked up to a “desperate” company in panic mode.
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Chaos on the lot, and a plan in Washington
“It’s chaos over there. Projects are on hold,” the insider says.
That tracks with everything we’ve been reporting.
Insiders describe open season on James Gunn’s job, with Mike De Luca and Pam Abdy set to take DC under their umbrella once the deal closes.
The Batman Part II just slid to February 2028, a day after I reported on the standoff over Gunn wanting his own Batman, with Alan Ritchson the frontrunner for Gunn’s DCU Batman.
But the insider adds something that changes how you should read the week’s biggest story: “Ellison is meeting with both sides of the aisle for National Tax Credit for film, and that is to make concessions to the States. Still a process but they feel confident States will withdraw their lawsuits.”
When Variety reported that Ellison was in D.C. pushing a first-ever federal film incentive, the framing was irony: the mogul funding Hollywood’s rescue the same day California sued him.
Per my insiders, it isn’t irony. It’s strategy.
The federal tax credit is part of the peace offering to the suing states.
Stack it on top of the binding commitments Paramount already put on the table, the 30 theatrical releases a year, the 45-day windows, keeping both California lots open, and you can see the settlement taking shape: the states get a face-saving win for their film economies, and Paramount gets its merger.
Bonta’s Solution Is the Warner Bros. Breakup He Claims to Prevent
However, publicly, California Attorney General Rob Bonta is having none of it.
In his first tough interview about the case, he said he can’t credit executive promises made to get mergers approved. Zaslav promised 20 movies in 2024 and delivered nine, so why believe Ellison’s 30?
Fair point. But listen to what Bonta said next.
Asked what Paramount could actually do to satisfy him, he said promises don’t count, only “structural remedies” do. That’s lawyer-speak for selling things off: a divestiture, a breakup.
So follow the roads.
If Bonta ever settles, his stated price is pieces of the combined company being sold.
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If Bonta wins and the deal dies, my insiders say Warner Bros. gets sold off in pieces anyway, because the healthy, independent Warner Bros. his lawsuit assumes he’s protecting does not exist.
So in either of Bonta’s win scenarios, Warner Bros. loses.
The only future where Warner Bros. stays whole is the deal Bonta is suing to stop, the Paramount merger.
Why ‘sold off in pieces’ is the real alternative
The MGM comparison is not hypothetical.
Before Ellison’s $30-per-share offer, Warner Bros. Discovery had already spent months preparing to split itself into two companies so the pieces could be sold separately.
That breakup plan had already mapped out how Warner Bros. could be carved apart.
The bidding war also showed who would come for the pieces: Netflix, whose own film chief admitted it won’t work with filmmakers who insist on theaters. The very streamers Bonta claims aren’t a threat, yet Paramount is.
And Warner Bros. Discovery’s own boss is not acting like a man planning to run this company for years.
Per Puck’s Matthew Belloni, CEO David Zaslav spent lawsuit week hitting Wimbledon and Sun Valley, and cashed out another $59 million of his own Warner Bros. stock the very day the states sued. Sellers sell.
If the states kill this deal, the fallback is not a healthy, independent Warner Bros.
The fallback is the breakup, a damaged stock, and a seller shopping the parts to buyers who don’t want a studio; they want a library.
MGM was once the mightiest studio in Hollywood. Today it’s a label inside Amazon, a streamer.
Per my insiders, becoming an Amazon-owned label like MGM is the “best-case” outcome if the deal dies. The worst-case outcome is Warner Bros. being broken up and sold for parts.
Which is worth remembering when you read Bonta’s op-ed about preserving the industry.
Paramount’s response already said the quiet part: neither company believes it can compete alone.
The states say they’re protecting competition and content. Per my insiders, the alternative they’re protecting is a fire sale.
Friday, Judge Araceli Martínez-Olguín, who now has every case against this deal on her desk, decides whether the clock stops.
The states’ emergency brief asking her to do exactly that now uses Batgirl as evidence: the finished $90 million movie the last mega-merger erased.
Matt McGloin is the editor-in-chief and publisher of Cosmic Book News, the independent entertainment news site he founded in 2008. He covers movies, comics, TV, video games and pop culture and has reported major industry scoops over the years, including revealing the Avengers: Endgame title ahead of its official announcement. Through Cosmic Book News, he helped Marvel Comics promote Guardians of the Galaxy and Nova through exclusive previews, artwork, and interviews, with the site also quoted in solicitations and on comic covers. He also reported on Marvel’s Daredevil: Born Again retooling before it was later confirmed by the trades.