As the legal battle over the $110 billion Paramount Skydance–Warner Bros. Discovery merger drags on, a coalition of state attorneys general is fighting to block the sale on antitrust grounds — and the buyer is threatening to leave California if the lawsuit succeeds. A leaked report now puts a number on the fallout: As many as 58,000 lost jobs and up to $21 billion a year in losses for California.
The report — from the Los Angeles Economic Development Corporation's Institute for Applied Economics, commissioned by Paramount itself — was leaked Saturday by Politico and lays out grim numbers for the motion picture industry. Leadership at Paramount-Skydance is negotiating with the gaggle of AGs, led by California's Rob Bonta, and racing against an Oct. 1 deadline: If the merger hasn't closed by then, the deal's "ticking fee" kicks in, paying Warner Bros. Discovery shareholders $7 million a day. Paramount's threat to relocate the studio to Georgia, Tennessee or Texas has been one of its central negotiating tactics — and has drawn uproar across the industry.
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The new report quantifies just how much California stands to lose. It finds the state "would experience the permanent loss of approximately 28,990 to 57,980 full-time job-years statewide across all industries, and losses of between $10.6 billion and $21.2 billion annually in economic output."
But Paramount's post-merger commitment to produce 30 features a year for three years would generate an estimated 1,020 to 2,760 job-years in California, and between $377.7 million and $1.01 billion in economic output between Oct. 1 and Sept. 30, 2031. The totals reflects between 340 and 920 job-years and between $125.9 million and $337.2 million in statewide output every year for three years.
The estimated job losses include direct, indirect and induced jobs — accounting for ripple effects through Paramount's California supply chains and the broader economic activity tied to household spending. In other words, the total reflects job losses across all industries, not just film and TV.
An added blow would come from converting Warner Bros.' soundstages to commercial or residential property, which the report says would "permanently strip" California of infrastructure built over a century — infrastructure that supports the vendors, crews and post-production facilities built up around it.
California remains the world's fourth-largest global economy, with a nominal gross domestic product of about $4.1 trillion to $4.4 trillion. If Paramount were to exit, the report states, the best-case scenario would see the company slow-walk its departure as it reduces its spending in California. But the worst-case scenario would involve Paramount "substantially or entirely" relocating to another state, which would tank the state's economy in terms of tax revenues.
U.S. District Judge Araceli Martinez-Olguin has set a Sept. 24 hearing to consider Paramount's $1.88 billion bond request of the 12 states and the Writers Guild of America, which is also suing to block the merger. The studio made the bond requests as security to cover losses it would incur if the deal is not completed until after the trial.
If the parties do not settle ongoing negotiations, both are moving toward a March 2027 trial date.
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