A merger years in the making is about to close
Hollywood is about to get smaller. After months of legal wrangling, regulatory settlements, and a bidding war that saw Netflix walk away, the combination of Paramount and Warner Bros. Discovery is set to close within weeks — creating a new entertainment giant that will reshape the streaming landscape for everyone who pays for HBO Max, Paramount+, or both.
The timeline tells the story of how hard-fought this deal has been. Netflix was once in the running, but dropped out in February, with co-CEOs Ted Sarandos and Greg Peters explaining: "At the price required to match Paramount Skydance's latest offer, the deal is no longer financially attractive." The Writers Guild dropped its lawsuit against the merger. The states settled their objections. On 24 September 2026, a judge held off on approving the settlement — but most signs point to the deal closing shortly, not least because Paramount faces a ticking fee of 25 cents a share per quarter — roughly $7 million a day — if the deal is not closed by 30 September. If the judge rejects the settlement, a trial is set for March 2027.
California Attorney General Rob Bonta said the settlement "resolves our antitrust concerns in every market alleged in our case." That regulatory clearance was the last major hurdle. What remains is the small matter of integrating two of the largest studios in Hollywood history — and deciding what happens to the streaming services they own.
What the settlement requires
The settlement extracted real commitments from Paramount in exchange for regulatory approval. Under its terms, the combined company would release 30 films a year in theatres for two years, then 32 a year for three more years — a significant pledge to theatrical exhibition at a time when studios have been shrinking their cinema slates. At least four of those films a year must be independent films, and at least 20% must be big-budget productions costing $50 million or more.
There are teeth behind the promises: Paramount would pay $30 million for every film it comes up short. The company also cannot sell or close its Los Angeles studio lots for five years, and a new independent board would exercise oversight over CNN and CBS News — two news organisations that will end up under the same corporate roof, a prospect that drew particular scrutiny from regulators and journalists alike.
Whether those commitments survive contact with commercial reality is the open question. As one consumer wrote in response to the merger's promises: "Promises are made and not kept." Another added: "I don't think it matters what they promise before the merger, because that can all change once the merger has gone through." That scepticism is not cynicism for its own sake — it is the learned response of an audience that has watched media mergers promise the moon before.
HBO Max and Paramount+ are becoming one service
For streaming subscribers, the most concrete consequence is this: HBO Max and Paramount+ are set to combine into a single streaming service, Paramount confirmed in March. That puts two of the industry's most distinctive libraries — HBO's prestige television and Warner Bros.' film catalogue on one side, Paramount's franchises, CBS programming, and sports on the other — under one subscription.
Wall Street is enthusiastic. Analysts have called the combination a potential streaming powerhouse, with one widely cited assessment arguing: "We view the combination of HBO Max and Paramount+ as a streaming powerhouse that has the potential to go from the 4th and 5th streaming services to rivaling Disney and Amazon for the 2nd and 3rd spot behind Netflix in premium SVOD."
The scale is genuinely significant. HBO Max currently commands roughly 140 million paying global subscribers, while Paramount+ sits at around 79.6 million — putting the combined platforms on track to reach nearly 220 million subscribers immediately, with some analysts projecting more than 240 million by 2030. That would make the merged service a genuine challenger to Disney and Amazon for the number two and three positions in premium streaming, behind Netflix.
There is overlap to account for: Morgan Stanley estimates that roughly 28% of subscribers currently pay for both services, which means some churn is inevitable once they combine. But the same research found encouraging signs for growth — about 23% of consumers who subscribe to neither service said they would likely add the combined platform, and 17% indicated it could replace another streaming service entirely. In other words, the merger could simultaneously lose some duplicative subscribers and gain new ones who were waiting for a single, stronger offering.
The $77 billion problem
Here is the catch — and it is an enormous one. Analysts estimate the combined company's net debt will sit at $77.2 billion by the end of 2026, declining only modestly to $75.1 billion the following year. Interest expenses alone are projected at $6.37 billion in 2027. That is one of the largest debt burdens in recent media history, and it will hang over every decision the new company makes.
Morgan Stanley believes the company can gradually reduce that debt over the next three years, expressing confidence that the merger could generate more than $6 billion in savings — roughly 11% of operating costs. Whether those projected savings materialise quickly enough to ease investor concerns remains the central question heading into the deal's close. Cost savings in media mergers have a habit of arriving as layoffs, cancelled projects, and consolidated services — which is to say, they arrive as things subscribers notice.
After the deal closes, Hollywood's old studio system will be down to its last members: Disney, Universal, Sony, and the combined Paramount-Warner Bros. would be the final survivors of the major-studio era. Everything else has been absorbed, rebranded, or turned into a content arm of a technology company.
What consumers actually fear: higher prices
Strip away the Wall Street analysis and the regulatory theatre, and the question subscribers keep asking is the simplest one: will my bill go up? The early evidence suggests they already expect it to. In an overnight poll of 472 online adults conducted by Forrester's ConsumerVoices research community, 56% of respondents who subscribe to HBO Max, Paramount+, or both identified higher streaming prices as their biggest concern about the merger — remarkably consistent across the subscriber base, at 53% of HBO Max-only subscribers, 57% of Paramount+-only subscribers, and 57% of those who pay for both.
"Their decision to merge shouldn't cost me more," wrote one subscriber. Another asked Paramount to explain the merger's impact "in terms of dollars and cents." Nearly half of current subscribers said better value is the most important outcome the combined company must deliver. And 29% of respondents said none of the proposed outcomes — the theatrical commitments, the news oversight, the promised investment — would make them more supportive of the merger. Consumers want multiyear price commitments, preserved programming, continued access, and consequences if commitments are not honoured.
They are unlikely to get the price commitments, at least not formally. But the commercial logic cuts both ways. A combined HBO Max–Paramount+ service launching into a market where Netflix charges $26.99 for premium and Disney+ charges $21.49 has room to price a mega-bundle attractively — and every incentive to use that pricing to pull subscribers away from rivals. The debt, however, pushes the other way: $6.37 billion in annual interest is a powerful argument for charging more, not less.
For subscribers, the practical advice is familiar: watch your billing emails closely over the coming months, understand exactly what happens to your existing subscriptions when the services combine, and remember that grandfathered pricing in media mergers has a habit of expiring. The new streaming giant may well be worth paying for. Just do not assume it will cost what the two services cost today.
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