O'Leary Blasts Paramount-WB Deal, Backs Merger Lawsuit

Michael O’Leary, the chief executive of Cinema United, threw his organization’s weight behind efforts to block the proposed merger between Paramount Global and Warner Bros. Discovery, calling the combination a “direct threat” to the theatrical exhibition business. Speaking at a press conference in Washington, D.C., on Monday, O’Leary endorsed pending litigation aimed at delaying or derailing the deal, arguing that it would give the resulting studio too much control over content production, distribution, and exhibition windows.

“This merger is not about competing more effectively in a changing media landscape - it’s about eliminating choice for consumers and squeezing independent theater owners out of the picture,” O’Leary said. “We’re backing the lawsuit to preserve a marketplace where movies can still find audiences on a level playing field.”

The deal, announced earlier this month, would combine two of Hollywood’s largest studios, creating a single entity with a massive library of film and television properties, including the DC Universe, Harry Potter, Mission: Impossible, and Warner Bros.’s animation and live-action catalog. Proponents argue the merger is necessary to compete with streaming giants like Netflix and Amazon, but O’Leary and his membership - which represents more than 30,000 movie screens across the United States - see it differently.

Antitrust Concerns and the Exhibition Window

O’Leary pointed specifically to the merger’s potential impact on the so-called theatrical window, the exclusive period during which a film plays only in cinemas before moving to home video or streaming. Paramount-Warner Bros. would control a combined market share of roughly 30 percent of domestic box office revenue, according to industry estimates. That concentration of power, O’Leary argued, would allow the new entity to dictate shorter windows, steeper rental terms, and more aggressive demands for premium large-format screens.

“Independent theaters already operate on razor-thin margins,” O’Leary said. “If one company controls both the product and the distribution pipeline, we’re not just talking about less competition - we’re talking about the survival of the exhibition sector as we know it.”

Cinema United has filed an amicus brief supporting an antitrust lawsuit brought by a coalition of independent theater owners and advocacy groups. That lawsuit, filed in federal court in Los Angeles, alleges that the merger violates the Sherman Act by creating a near-monopoly on certain film genres and franchise properties. O’Leary did not provide a timeline for the litigation but said the organization was prepared to “fight this through every legal avenue available.”

Deal’s Broader Implications for Hollywood

The Paramount-Warner Bros. merger has drawn scrutiny from regulators and lawmakers on both sides of the aisle. The Department of Justice’s Antitrust Division is reportedly conducting a preliminary review, though no formal challenge has been announced. O’Leary said Cinema United has been in contact with DOJ officials and urged them to “take a hard look at the cumulative effect of studio consolidation over the past decade.”

He noted that the industry has already seen major acquisitions - Disney’s purchase of 21st Century Fox, Amazon’s takeover of MGM, and the merger of WarnerMedia and Discovery. Each deal, he argued, has reduced the number of independent distributors willing to strike fair deals with smaller chains and single-screen theaters.

“This isn’t just about this one deal,” O’Leary said. “It’s about a pattern of concentration that has left exhibition with fewer and fewer partners who are actually interested in the health of the theatrical experience.”

O’Leary also took aim at the merged company’s streaming strategy. Both Paramount+ and Max currently operate as separate platforms, and the new entity would control two significant streaming services. O’Leary warned that the company could prioritize streaming premieres over theatrical releases for certain films, further eroding the window that theaters depend on.

Support from Filmmakers and Exhibitors

Cinema United’s stance has drawn support from several high-profile filmmakers and smaller exhibitors. Directors’ guilds and independent producer organizations have privately voiced similar concerns, O’Leary said, though many have been reluctant to speak publicly for fear of alienating powerful studios.

“We’re not just representing theater owners - we’re speaking for the directors, the writers, and the cinematographers who make movies designed for the big screen,” O’Leary said. “When one company gets to decide which films get a theatrical release and which get buried on a streaming menu, that’s not progress. That’s a loss for cinema as an art form.”

A representative for the merged company, which has proposed the name “Paramount Warner,” declined to comment on O’Leary’s remarks. In earlier statements, the companies have emphasized that the combination would create “a more agile, competitive studio capable of investing in a diverse slate of theatrical releases.”

O’Leary dismissed that argument as “corporate spin,” pointing to recent history. “We’ve seen these promises before,” he said. “Every merger promises more investment in theaters. What we actually get is fewer movies, shorter windows, and higher costs for the operators who bring audiences into the seats.”

Next Steps

The lawsuit backed by Cinema United is expected to face a motion to dismiss in the coming weeks. O’Leary said the organization is prepared to take the case to trial if necessary. He also hinted at potential legislative action, noting that Cinema United had begun discussions with members of Congress about updating antitrust law to better address vertical integration in the entertainment industry.

For now, O’Leary said, the fight is about delaying the merger long enough to give regulators and the public a clear-eyed view of its consequences.

“We don’t oppose consolidation on principle,” O’Leary concluded. “We oppose consolidation that kills competition, crushes small businesses, and reduces the diversity of stories that make it to the screen. That’s what this deal represents, and we’re not going to sit quietly while it happens.”

Source: Variety