In brief: Warner Bros. Discovery’s CEO candidly described the challenging outlook for the media company.

Welcome to the Brief, The Media Leader’s round-up of media news.

The new company formed by a proposed merger between Paramount Skydance and Warner Bros. Discovery will also increase streaming competition and boost cable networks.

Paramount’s merger with Warner Bros Discovery (WBD) would create a combined entity with net debt of $79bn and net leverage of 6.5x. To make the business sustainable, it will need to massively reduce costs, likely requiring content cuts.

The transaction, valued at $82.7bn (including debt) is expected to close by Q3 2026, after Warner Bros Discovery carves out its linear TV businesses into a new company, Discovery Global.

Analysis: The potential merger would likely result in a smaller streaming market and less content production. It would also consolidate powerful information ecosystems into fewer, Donald Trump-aligned hands.

The Media Leader explores the rationale behind WBD’s move and how the new networks businesses could grow organically, while Disney believes it will make its own unified proposition more competitive.

WBD plans to split itself into two public companies by next year, with one maintaining its film properties and streaming service, while a global networks company will own CNN, TNT Sports and Discovery.

The company has created two main divisions, with linear TV in one and the other housing streaming, studios and HBO properties.

Amid a backdrop of fevered M&A chatter, 2024 was a year replete with significant moves for both global streamers and broadcasting incumbents.