The settlement of state attorneys general’s antitrust lawsuit over the Paramount-Warner Bros. Discovery merger protects Pluto TV or another free ad-supported streaming service for five years but leaves TV studios, premium cable, and the Paramount+-HBO Max combination entirely unguarded. California Attorney General Rob Bonta spent more than six minutes on film-production terms at his Monday press conference and devoted two lines to television: a news editorial independence board for CBS News and CNN, and a requirement that Paramount and Warner Bros. keep basic-cable carriage negotiations separate.
The cable carve-out
The agreement lists the basic-cable networks Paramount must divest if it fails to maintain arm’s-length negotiations: BET and its sub-channels, VH1, and Comedy Central. MTV and Nickelodeon are excluded. Both BET and VH1 had already been shopped twice before this deal. The divestiture trigger applies only to basic cable; a disclaimer in the settlement states the separate-negotiation rule “does not apply to other Combined Entity offerings (e.g., premium cable channels, streaming services, or broadcast).”
The studio silence
Nothing in the settlement prevents the combined entity from merging Warner Bros. Television, Paramount TV Studios, and CBS Studios, a consolidation certain to cut jobs. No headcount floor or layoff guardrail was included. The same omission applies to the planned merger of Paramount+ with HBO Max, which the companies have said will proceed. The AGs focused on movies and basic cable because those markets raised the clearest antitrust concerns; the combined streaming service will be a major subscription player but not a dominant one.
The Showtime loophole
Showtime, Paramount’s premium cable network, is absent from the carriage-separation requirement. That allows the combined company to bundle Showtime with HBO, the market leader, in negotiations with distributors. The omission is striking given that Showtime, like the basic-cable nets, negotiates affiliation agreements. The settlement’s explicit carve-out for premium channels makes the omission deliberate rather than oversight.
Pluto’s curious prominence
Pluto TV’s five-year protection stands out because the service faced no credible divestiture threat and has no Warner Bros. Discovery counterpart. Paramount’s leadership has been bullish on Pluto, acquiring library content and integrating its tech stack with Paramount+. David Ellison, chairman and chief executive, called himself “a big believer in the FAST space” on the Q4 2025 earnings call, and the upfront presentation in May positioned Pluto as central to the ad strategy. Yet Pluto’s market share has slipped behind Tubi and Roku, co-founder Tom Ryan and core staff have departed, and the platform had been neglected for years before the current regime’s renewed investment. The settlement enshrines a business the company already intends to keep.