Netflix Exec Predicts “$6 Billion in Job Cuts” if Paramount Buys WBD

Netflix‘s chief global affairs officer says the human cost of a Paramount Skydance x Warner Bros. Discovery deal would be astronomical.

On Fox Business Network on Monday, Clete Williams rang the alarm bells on Paramount‘s competitive bid for all of WBD; Netflix currently has a deal in place for the Warner Bros.‘ streaming and studios business, inclusive of HBO.

Netflix’s deal for WB is presently under regulatory review here and abroad. Williams told Fox Business anchor Liz Claman that it’s all “just ordinary course of business stuff.”

“Of course, the Department of Justice is going to investigate this transaction and make sure that it’s good for our economy and good for our consumers,” Williams said. “And my understanding is that they’ve sent similar inquiries about Paramount as well.”

Williams says Netflix is currently “engaging with state attorney generals.”

Nothing anticompetitive to see here, Williams said. He can’t say the some for Paramount.

“They have what we call the Noah’s Ark problem, which is, if they effectuate this deal, they’re going to have two of everything,” Williams said.

The largest cost of sorting the duplication out would be the human cost, Williams said. Paramount Skydance has identified $6 billion in synergies with Warner Bros. Discovery; Netflix has acknowledged $2-$3 billion in synergies for their deal in hand. And not all corporate synergies are created equal.

“We’re tripling jobs, while Paramount has cut 3,500 jobs in recent years,” Williams said. “Paramount has identified $6 billion in synergies in the offer that they made, which is code for $6 billion in job cuts.”
 
“And, quite frankly, we think it’s going to be even more than that, because this is going to be the largest leveraged buyout in history,” he continued. “And so they’re going to have to cut, cut, cut.”

Williams says Netflix’s savings due to synergies is “primarily from licensing fees and saving on things like that.”

“It’s not from job cuts,” he said.

Netflix stunned the entertainment industry in December by entering into an agreement to purchase Warner Bros. for $83 billion; it is now an all-cash deal. But Paramount Skydance’s David Ellison is not going down without a fight.