According to the 12 Democratic state attorneys general who sued this week to block Paramount Skydance’s $110 billion acquisition of Warner Bros. Discovery, the theatrical movie business is “a big business, and it is thriving.” That premise carries the states’ theory of harm, and it does not survive contact with the box office: ticket sales are half what they were a generation ago. The companies call the states’ case “one of the weakest merger challenges in modern antitrust history.” In a crowded field, that is saying something.
The suit came one month after the Justice Department’s Antitrust Division closed an eight-month, 2 million-document investigation, concluding that the deal is not likely to harm competition — indeed, likely to increase it — and imposing not a single condition. Yet on July 20, U.S. District Judge Araceli Martinez-Olguin granted the states a 14-day temporary restraining order, finding compelling evidence that the combined company would hold outsize share of the wide-release theatrical market. That finding deserves scrutiny before it hardens into the basis for a preliminary injunction at the Aug. 3 hearing — because market share in a shrinking, ticket-starved industry means something different than it did a generation ago.
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Far from “thriving,” theaters sold roughly 770 million tickets last year — down 37% from 2019 and less than half the 1.57 billion sold at the 2002 peak. The share of adults who see a movie at least monthly has fallen by more than half. Receipts hold up only because the average ticket now runs north of $13. Charging ever more to ever fewer people is not a thriving business; it is a shrinking one, repriced. And moviegoers will tell you why they stopped coming: nearly 2 in 5 adults who attend less often say there is simply not a good enough variety of new films worth the trip.
Much of the rest of the case comes down to jobs. The Teamsters call the deal a “direct threat to film and television workers nationwide”; one producer predicted 10,000 job losses, without any data behind the figure. Yet the merger’s own critics have noted that Los Angeles County lost more than 42,000 motion picture jobs between 2022 and 2024 — years before this deal existed. Entertainment employment has fallen roughly 30% in four years, Los Angeles on-location filming is down more than 40% since 2022, and production employment sits at a 30-year low. Hollywood is not losing its audience to consolidation. It is losing its audience to itself.
Nor would blocking the deal freeze some healthy status quo in place. Warner Bros. Discovery was for sale because its trajectory was unsustainable. Its revenues slid from $41.3 billion in 2023 to $37.3 billion last year, after a $9.1 billion write-down in 2024 — the company’s own reappraisal of its worth. Stopping the deal does not change the market.
Opponents of the merger fail to consider the impact the deal could have on long-term employment across the wider creative economy, where the meaningful driver is production volume. Film and television support 2.01 million American jobs, pay $202 billion in wages, and sustain more than 162,000 businesses, 93% of which employ fewer than 10 people. A single-location shoot injects roughly $1.3 million a day into a local economy. The only question that matters is whether this merger means more movies or fewer.
The answer is on paper. Paramount has committed to maintaining both studios, releasing at least 30 theatrical films a year, and guaranteeing a 45-day theatrical window before video-on-demand. And since Skydance took over last August, Paramount has nearly doubled its slate from eight films to 15. These commitments mean more production days, more crews, more stages booked, more location spending — precisely what the unions say they want protected, and the only real medicine for what ails Hollywood: too few movies worth leaving the house for.
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The economics bear that out. Economist Jeff Ferry of the California Policy Center finds that a 30-film slate would raise the two studios’ combined output by 50%, lift the five major studios’ total output by 14%, and add close to $1 billion to Hollywood’s annual production investment, supporting 6,600 direct production jobs — roughly 40,000 in all. A University of Wisconsin-Whitewater study by economists Ike Brannon, Erik Bergren, and Russell Kashian models the commitments nationally: nearly $20 billion in annual economic stimulus supporting more than 90,000 jobs.
Enjoin the deal, and all of it vanishes — the 30-film floor, the theatrical window, every job these economists count. Courts should weigh evidence, not rhetoric. An industry that has lost half its audience in a generation needs no protection from more movies.
Ashley Baker (@andashleysays) is the executive director of the Committee for Justice.
