Paramount Skydance has offered three-year written contracts to AMC and Regal guaranteeing 30 theatrical releases annually and a 45-day exclusive cinema window if its acquisition of Warner Bros. Discovery proceeds. The binding commitments aim to resolve antitrust concerns raised by state attorneys general ahead of a March trial.
Paramount is moving to lock down the future of its theatrical distribution strategy amid intense regulatory scrutiny over its proposed multi-billion-dollar corporate expansion. According to reports from Bloomberg, the studio has agreed to sign binding agreements with the world’s two largest theater operators, AMC Entertainment Holdings Inc. and Cineworld Group’s Regal Cinemas, establishing firm benchmarks for output and screen exclusivity.
AMC and Regal Secure Three-Year Output Pledges
The proposed contracts require Paramount to deliver at least 30 movies a year to commercial cinemas under the three-year agreements offered to the major chains. Under the terms of the private accords, those 30 annual releases would receive an exclusive theatrical window lasting at least 45 days before transitioning to home viewing formats. Furthermore, the titles would be restricted from appearing on streaming platforms for a minimum of 90 days following their initial theatrical debuts.
While Paramount Chief Executive Officer David Ellison has previously made verbal commitments regarding theatrical output in public forums, the written commitments provide assurances that leadership will not alter course once the transaction concludes. Sources familiar with the discussions note that the contracts include specific enforcement penalties if Paramount fails to fulfill its yearly distribution obligations.
Antitrust Lawsuits and Industry Division Ahead of March Trial
The proactive theater guarantees serve as a direct template for settling the antitrust lawsuit brought by 12 states seeking to block Paramount’s US$110 billion (S$140 billion) acquisition of Warner Bros. Discovery. Paramount has already tried to negotiate a settlement with California Attorney-General Rob Bonta, who is leading the lawsuit by the states.
State prosecutors claim the deal will harm the movie business because Ellison would wield too much control and reduce output, costing people jobs. The merger would place two of Hollywood’s oldest and largest movie studios, Paramount and Warner Bros, under one roof. A trial is scheduled for March.
The merger has divided the cinema industry. AMC and Regal came out recently to back Ellison. AMC CEO Adam Aron published an op-ed in the Hollywood trade outlet Variety, while Regal CEO Eduardo Acuna said in a separate statement that a long court fight would be bad for the movie business. Cinema United, a lobbying group that represents theatre chains big and small, remains opposed to the deal. Ellison and his inner circle have been talking to the theatre chains for months, seeking to secure their support. Ellison has insisted several times that he plans to increase the studios’ output and support theatres. The Paramount-Warner deal began with the movies,
he wrote in a recent op-ed for the New York Times. I have loved film since I was old enough to sit still for one, and scenes from the movies have shaped who I am.
Financial Pressures and Union Skepticism Over Debt
Many Hollywood unions, producers, tradespeople and lawyers are sceptical. When Walt Disney acquired the 20th Century Fox studio, it also pledged to keep making as many movies. Instead, the combined output has dropped. Paramount is borrowing almost US$50 billion to buy a much larger company and will need to find billions in cost savings to service its debt.
Ellison was initially confident his deal would close by the end of September, but he has now run into the lawsuit from the states, as well as one from the Writers Guild of America. By the time a trial begins in March, Paramount will owe Warner Bros more than US$1 billion in late fees due to the delay. Ellison has tried to turn the tide of public opinion, rallying allies like Hollywood super agent Ari Emanuel, who also published an op-ed supporting the deal.
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