On March 5, a week after inking a $111 billion deal, Paramount CEO David Ellison and Warner Bros. Discovery CEO David Zaslav conspicuously lunched in the executive dining room on the Warner Bros. Studio lot, breaking bread over their megamerger that will reshape Hollywood.

Unlike December’s visit from Netflix co-CEOs Ted Sarandos and Greg Peters to the WB lot, no glamour photos were taken, but the public appearance of Ellison on his property-to-be underscores the new world order that is about to engulf the industry. The rich and powerful are poised to get richer and more powerful, and much of the rest of the industry is wondering what comes next.

The Paramount-Warners marriage is perhaps the quintessential example. A year ago, Ellison was the CEO of Skydance, a studio with a valuation of $4.75 billion. When this deal closes, he will control two of Hollywood’s legacy studios, an empire valued at north of $120 billion.

Zaslav is running a company that had a share price of $10 a year ago. Now he is the toast of Wall Street, more than tripling the company’s value as Paramount, Netflix and NBCUniversal circled the prize. Zaslav himself is poised to exit with shares worth just shy of $800 million, according to Equilar, including the $114 million or so in stock he sold March 3, just days after the Paramount deal was announced. The executive, of course, now oversees a studio set to dominate the Oscars, and a resurgent HBO.

“Give Zaslav credit, he’s my hero,” investment manager Mario Gabelli, who is also a large WBD shareholder, toldThe Hollywood Reporterwhen Paramount and Netflix were still engaged in a battle for the prize.

Wall Street and the mogul class are winning, even as the working class in the business are holding their breath. Paramount, after all, shed 10 percent of its workforce after the Skydance takeover, and with $6 billion in synergies targeted after it eats Warners, significant cuts totaling thousands of employees are once again in the cards for both companies as they merge.

Ellison has used his post-deal comments to emphasize that the company only wants to expand production, citing a promise to release 30 theatrical films a year and to continue as a buyer and seller of TV shows. But a slew of previous mergers have left the creative class skeptical, to say the least.

And after years of production pullbacks, there are signals that it’s going to get worse before it gets better. Call it a Hollywood of haves and have-nots.

Paramount Skydance’s pursuit of Warner Bros. Discovery will create a trio (alongside Netflix and Disney) of global entertainment giants, while the tech giants Amazon, YouTube and Meta are encroaching farther on territory that was once the realm of legacy media. New kings of Hollywood, from Ellison and Sarandos to YouTube’s Neal Mohan and Disney’s Josh D’Amaro, will benefit, while others figure out how to proceed without their scale.

“The transformation that’s happening in our business today, it’s massive,” laments a C-suite level executive at a company that’s been left out of that top tier. Their company, and others in a similar situation, are evaluating their options.

Source: Drudge Report