Four Democratic lawmakers have written to the Department of Justice to investigate Warner Bros. Discovery and launch an inquiry into alleged anti-competitive behavior. Democratic representatives Elizabeth Warren, Pramila Jayapal, David Cicilline and Joaquin Castro wrote that the merged company has harmed workers and reduced consumer choice. Warner Bros. Discovery was formed after WarnerMedia merged with Discovery Inc. in April 2022.
\n\u201cWe respectfully urge the Justice Department to investigate the state of competition in affected labor and consumer markets following consummation of this merger, which appears to have enabled Warner Bros. Discovery (WBD) to adopt potentially anticompetitive practices that reduce consumer choice and harm workers in affected labor markets,\u201d the lawmakers wrote in the letter.
\nWarner Bros. Discovery did not respond to TechCrunch’s request for comment.
\nThe lawmakers argue that Warner Bros. Discovery’s new ownership is \u201chollowing out an iconic American studio.\u201d The letter outlines that many projects were cancelled by Warner Bros. Discovery not long after the merger, including \u201cBatgirl,\u201d which was canceled even though filming for the movie had already been completed. The letter also refers to the cancellation of popular shows like \u201cGordita Chronicles\u201d and \u201cThe Time Traveler’s Wife.\u201d
\nIn addition, the lawmakers note that Primetime Emmy Award winner J. J. Abrams is now shopping elsewhere for a home for his TV show \u201cDemimonde\u201d which was initially picked up by HBO and then canceled before production began on the project.
\nThe letter notes that consumers will likely never be able to watch shows purchased then cancelled by the company, and that Warner Bros. Discovery’s conduct amounts to a \u201ccatch and kill\u201d practice that limits consumer choice.
\nThe lawmakers also outline that the company’s actions are leaving workers with fewer choices for employment and advancement.
\n\u201cShortly after the merger was finalized, WBD began realizing a number of cost synergies that were used to justify the merger in the first place\u2014including cuts to hundreds of jobs for working people,\u201d the letter reads. \u201cFirst, WBD cut the streaming platform CNN+. The CNN+ cut affected about 350 employees, and four months later, CNN laid off an additional 400 employees. WBD also enacted 100 layoffs in its company’s ad sales department as another cost-cutting effort related to the merger. In total, the aforementioned cuts affected thousands of people. Notably, WBD still has $3.5 billion in planned cuts\u2014which does not bode well for workers.\u201d
\nThe letter ends by asking the Department of Justice to take another look at the transaction and take into consideration the actions that the company has taken since the merger was finalized a year ago. The lawmakers write that they hope the guidelines for the merger are updated to ensure they reflect the needs of workers, consumers and content creators in the media and entertainment industry.
\nThe letter comes as Warner Bros. Discovery is expected to hold a press event sometime this week regarding its new direct-to-consumer streaming plan.<\/p>\n
Warner Bros. Discovery continues to lose money despite success of \u2018The Last of Us’ and \u2018Hogwarts Legacy’<\/p>\n