Hollywood panics as Paramount-Netflix battle for Warner Bros

Disaster, catastrophe and nightmare. That’s how Hollywood creative insiders describe the fall of once-mighty Warner Bros., with Netflix and Paramount vying to buy the landmark studio and tinsel town bracing for more turmoil and job losses.

Warner’s decline and impending sale — whether of Paramount Skydance as a whole, or of Netflix breaking it up into parts — is sad in Hollywood, where a historic slump in production has already battered the entertainment industry. Losing the studio, which has produced blockbusters ranging from Casablanca and Goodfellas to Batman and Harry Potter, would likely mean more job cuts and certainly mean fewer buyers for film and TV projects.

BBC interviews with dozens of actors, producers and camera crews reveal an industry trying to balance the lesser of two evils: the control of a tech giant accused of killing movie theaters (Netflix) or billionaires seen as too comfortable with President Trump (Paramount).

“David Ellison is a right-wing Trump billionaire,” a photographer’s assistant said of the Paramount Skydance CEO, who is the son of billionaire Oracle co-founder and close Trump ally Larry Ellison. “Netflix has historically tended not to micromanage production.”

If Netflix gets the deal it wants, it will buy Warner Bros.’s crown jewels — the 102-year-old HBO studio and its vast archive of movies and TV shows — leaving Warner’s legacy TV networks, such as CNN, TNT Sports, and Discovery, to another buyer.

Meanwhile, Paramount Skydance is worth $108bn (£81bn). Hostile takeover The bid for Warner Bros includes backing from Saudi Arabia, Abu Dhabi, Qatar and a fund set up by Jared Kushner, US President Donald Trump’s son-in-law.

It has raised concerns about the possibility of censorship and government overreach.

President Trump added fuel to the fire when he said, “CNN must be sold.”

The Warner Bros. deal is the latest in a long line of major changes in Hollywood since the pandemic.

Film and television production was halted in 2023 due to simultaneous strikes by actors and writers. Seemingly, everyone in Hollywood was working in 2022, as studios and streaming services went into a state of creative overdrive following coronavirus shutdowns. But when the labor strikes ended, the production boom never returned.

The fallout means that many media companies have had to close their doors – or merge. David Ellison’s Skydance Media bought Paramountanother legendary Hollywood studio, was killed earlier this summer, resulting in thousands of job losses.

When Warner Bros. put up a for sale sign, Paramount launched a campaign, eager to buy the company. But the studio eventually announced a deal with Netflix. The spurned Paramount then went straight to Warner Bros Discovery shareholders with a hostile takeover offer they say is “superior” to the Netflix deal.

Whether they’re rooting for Paramount, Netflix, or another potential buyer, the only thing people in Hollywood seem to agree on is the villain in this story — Warner Bros. Discovery CEO David Zaslav, who took home $51.9 million last year as Warner Bros. lost more than $11 billion and the company’s shares fell nearly 7%.

“I’ve watched Warner Bros. suffer ever since David Zaslav became CEO and rammed it into the ground,” says one actor who lost his home after his business dried up. He did not want to reveal his identity because he still hopes to work for Netflix and Paramount.

More than one person compared Mr. Zaslav to the fictional movie character Gordon Gekko, who said “greed is good” in the 1987 movie “Wall Street.”

Mr. Zaslav took over in 2022 during another massive merger of Discovery, Inc., which he managed with AT&T’s WarnerMedia, creating Warner Bros. Discovery. The merger saw several thousand jobs cut – and generous pay packages for Mr Zaslav.

“Zaslav is just Gordon Gekko – he came in, broke it and sold it all,” says a producer who used to work on the Warner Bros. set. “He said I would make all the shareholders rich and who cares about the history of this place.”

Warner Bros. disputed this characterization.

“Under David’s leadership and the talented team at WBD over the past three and a half years, the studio has regained its leadership position with a unique slate of films driven by original content, seen the DC Universe relaunched under one unified leadership team with a ten-year plan, and launched its streaming service globally and become profitable for the first time ever,” Robert Gibbs, Warner’s head of communications, said in a statement to the BBC.

For many in the movie business, everyone who buys Warner Bros. feels almost irrelevant. They have focused instead on how to reinvent themselves as the industry shrinks amid consolidation and the increasing use of artificial intelligence in entertainment.

“Every morning, no matter how much I tell myself to stay positive, I wake up feeling like I’ve failed in every way,” says an actor who is now homeless with his wife and two children, and relies on the kindness of friends and food banks while working odd jobs. He requested that his identity not be revealed for fear that this would affect his work in the future.

“I would rather see Netflix buy Warner Bros than foreign money,” he says.

Others aren’t so sure. The tech giant has arguably had the greatest revolution in the industry since Warner Bros. pioneered “talkies” in 1927.

“I think it’s a disaster,” says one showrunner, who did not want to be identified because he works with Netflix. “This is a company that says openly and proudly that theaters are no longer necessary. That’s scary. It’s a nightmare.”

Many theaters in the US are refusing to show Netflix movies due to its streaming strategy.

“At least with Paramount, we know the movies will make it to the big screen,” said one producer who worked at all three companies. “They haven’t killed the movie theaters.”

Netflix sought to allay those concerns, saying it expects to “maintain existing Warner Bros. operations and build on its strengths, including theatrical releases of films.”

Many in Hollywood want to believe them.

John Evans, a sound technician who dabbles in acting, writing and producing, points to Netflix’s restoration of the Egyptian Theater along the iconic Hollywood Boulevard as proof of their good faith.

The classic Egyptian Theater, dating from 1922, was the site of the world premiere of a movie — Robin Hood starring Douglas Fairbanks — and was in disrepair before Netflix bought the property in 2020 and gave it a $70 million renovation.

“I think it’s a good sign,” Evans said, adding that streaming is how many movie workers consume movies and TV like the rest of the world.

In the back of Warner Bros., tourists take selfies in front of the Central Perk café from Friends, and wander past building facades that resemble New York or Los Angeles. Inside the offices and writers’ rooms, for those still working, it’s business as usual.

“I’ve been through seven mergers,” said a producer working at Warner Bros. while developing a new show, explaining that it was sad to lose the studio because it meant it would be much harder to produce and sell shows with one less client. “But if you make good things, you make good things.”

The producer spoke on condition of anonymity on the day Paramount Skydance announced its hostile takeover bid. They said they were too busy to worry about selling because they were trying to get a show on the air — and they wouldn’t be surprised if another billionaire or trillionaire made another show for the studio by the end of all this.

“I joke about Elon coming in and doing it, but he can do it,” they said of the Tesla and X owner. “When you have people worth a trillion dollars, there are no rules.”