Paramount Global is actively engaging in discussions to merge its Paramount+ streaming service with another platform, a move that could potentially trigger a new wave of consolidation in the streaming industry. According to sources, the company is in talks with various media and tech companies, including Warner Bros. Discovery, to explore a partnership that would allow Paramount+ to be co-owned and better positioned to compete with giants like Netflix and Disney.
Warner Bros. Discovery, which previously held preliminary merger talks with Paramount Global, is one of the interested parties. Combining Warner’s Max and Paramount+ could bolster both services, providing a more competitive edge in the market. Additionally, Paramount Global is considering a partnership with a technology platform to leverage its extensive content library, as highlighted by co-CEO Chris McCarthy during a recent town hall meeting.
A merged streaming service would help reduce customer churn by offering more diverse programming, potentially taking Paramount+ losses off Paramount Global’s balance sheet by introducing new ownership. Discussions about a joint venture structure with Warner Bros. Discovery are ongoing, with ownership likely reflecting the financial standing and nature of each streaming asset.
Warner Bros. Discovery’s direct-to-consumer business saw a significant turnaround, generating $103 million in annual adjusted EBITDA in 2023, while Paramount Global reported a $1.67 billion loss in the same sector. Max boasts around 100 million global subscribers, compared to Paramount+’s 71 million.
Other companies, like Comcast’s NBCUniversal, have also shown interest in partnering with Paramount+, although previous talks did not progress far. McCarthy emphasized that a potential partnership could offer a substantial content library across various genres, drawing millions of viewers.
The broader industry context shows traditional media companies facing financial pressures from launching streaming services that have incurred significant losses. Industry consensus suggests that only a few global services can thrive, necessitating consolidation for survival. Former Fox Group CEO Peter Chernin has noted the possibility of combining services like Paramount, Peacock, and Max.
Media companies are increasingly focused on monetizing streaming content through bundles and partnerships. Recent examples include Disney and Warner Bros. Discovery planning to bundle their services, and Comcast introducing a package combining Peacock, Netflix, and Apple TV+.
While consolidation and better content packaging can be lucrative, it may also lead to customer confusion. Some executives foresee a future where platforms like Peacock, Paramount+, Max, and Disney+ could unite under a single application, similar to cable models, though rivalries and logistical challenges may complicate such efforts.
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