How David Ellison Plans to Mash Two Major Studios Into One

(bell ringing) This episode of The Town is brought to you by The Madison, the new original series on Paramount Plus. Academy Award nominee Taylor Sheridan's most intimate story yet, unlike anything he's ever done before. The Madison follows a family raised in a world of digital distraction forced by tragedy to truly see one another and come together. Authentic, multi-layered, and did I mention starring Michelle Fiverr and Kurt Russell? Don't miss The Madison, new series streaming March 14th, only on Paramount Plus. It is Monday, March 2nd. It's the biggest question in Hollywood right now, other than maybe how the club's chalame woman is coping with Timothy's loss to Michael B. Jordan at the actors awards on Sunday night. No, it's what does David Ellison plan to do with the combined Paramount and Warner Brothers discovery? If this $111 billion deal goes through, which is still a big question, of course, but if it closes, there are many, many questions about the future of two legacy Hollywood studios. And how exactly he plans to get $6 billion of cost savings out of the combined entity? We've got a few answers on Monday morning when Ellison and his Paramount Skydance leadership team held an investor call. First, he said, quote, this is not about consolidation. This is about reinventing the business, end quote. Then he immediately said HBO Max and Paramount Plus will be combined into one service, which, of course, is consolidation. Together, they've got more than 210 million subscribers, including duplicates. And Ellison said, we quote, have no divestitures planned at this time. That means no plans to spin off CNN or any of the other linear cable assets. They own a lot of those networks now. He also committed to 15 films per year, per studio at both Warner's and Paramount, all of them with 45 day theatrical windows, a big commitment, given how hard it is to put together movies that seem theatrical these days. He said HBO will remain HBO. And the company will continue to license movies and TV shows to other studios and platforms. It's good news for Warner television people. They've got to be licensing business. But he was light on details of the cost cutting, only to say it wasn't primarily focused on headcount, although that's pretty hard to believe. After all, Paramount Skydance currently has a market capitalization of about $15 billion. And the combined company will carry debt of about $79 billion, they say. That's a lot of debt. This $6 billion in cost cutting includes consolidating on the tech side, real estate, corporate overheads, et cetera. But how exactly will these companies be merged? That's what we're getting into today with Rich Greenfield, the analyst. It's the Wall Street perspective on the Paramount, Warner Brothers merger, and how exactly do you smash together two studios? From The Ring Earned Pock, I'm Matt Bellany, and this is The Town. All right, we are here with Richard Greenfield, analyst at Lightshed Partners, returning champion to The Town. Welcome back. Did I miss anything, Rich? Instagram, Jim Content Creator, anything else? Are you jealous, Matt? I am. Actually, they're not-- I'll do a pull-up contest anytime you want, Matt. The only question is, could you kick my ass at this point? After all of your recent workouts-- I'm not a fighter. I'm not a fighter. Yeah, we'll see about that. All right, let's get into this. I want to do on, because David Ellison has started talking about the contours of this mega merger, what he plans to do with both Paramount and Warner Brothers. And I have many questions. We went over with Lucas on Friday, but that was more of the Hollywood reaction. I want to get the analyst community reaction, because I think people in Hollywood are freaked out about this and want to understand how this will all go down. I want to do on, because I seem to remember a high-profile analyst kind of crapping all over the Ellison's bid for Warner, saying, don't do this, David. You're creating this debt bomb. You don't need this. Spend that money on your own content. Build a competitor to Netflix on your own. Don't do this. Now that they've done it, you seem to have changed your tune a bit. Well, I mean, look, they didn't listen to me. I mean, we give lots of advice. Not everyone listens to us. You know, look, I guess we have the financial baggage, I would say, of remembering the AT&T time Warner, or the AT&T Warner Media merger with Discovery Global. And you remember, Matt, that wasn't really all that long ago. And you remember-- It was only like five years ago. Okay, so if you go back five years ago, if you go back-- It was actually seven years ago, but really, when they got into it, it was about five. Well, I mean, they announced the transaction in 2021. We went back and looked at the deck that they provided to Wall Street that morning. Okay, so it was five years ago. Okay. It was literally five years ago. The deck they provided said that within 24 months, they would bring leverage down to three times. There would be three billion of synergies. That they would grow their EBITDA of $12 billion. So $14 billion. Yes. That is their measure of profitability. And what you're talking about is the-- Not AT&T buying time Warner. You're talking about the Discovery people. David Zaz left John Malone taking the Warner assets away from AT&T, creating Warner Brothers Discovery. They had a timeline. They had a predictor of what their profits would be. And it all went to shit almost immediately after they predicted it. So $12 billion of EBITDA never grew above $12 billion. In fact, it is sub $9 billion today. Yes. And so when you listen to Paramount today, they obviously came out with very bold predictions. They're starting with funny enough when you combine the current WBD with Paramount, which includes Skydance. The combined EBITDA is ding, ding, ding $12 billion. The same exact number. It is now expected to grow, Matt. Not from 12 to 14. We're now predicting 12 goes to $18 billion with $6 billion of synergies. So the old $3 billion, now with $6 billion. My point being, we've lived through bold predictions. I mean, we could go back. We could pull up Disney Fox and look at their projections in terms of synergies. I mean, look, the fundamental challenges can this company win? And winning, sure, part of it is. And what does winning mean? Surviving, not having us do this all over again in three to five years? I would say that's probably a good starting point, right? Is can we actually not have this asset? I mean, think about it. The this time Warner asset has essentially been in place since 2001 going back to the AOL time Warner merger. So this has been a constantly reshuffled asset. So I think there's two big questions outstanding. One is from a streaming standpoint. Can you actually build a daily use application? Meaning a service that people, not just me and you because we're nerds and we have every service and we check out everything new that's happening. But can the average person start thinking about the combined Paramount Plus HBO Max as something they use all the time? That has certainly not occurred. If we look back over the last five years, Warner certainly failed in that. When they came out of the box, what was their big prediction? We're going to turn HBO into HBO Max, where they actually called it Max to start. And the whole goal was to get you to have a far wider array of programming. They were putting on say yes to the dress. They were, you know, 51st days. Like none of that were. Yeah, they pivoted back and recognized that it was a failure. So, but we're doing it again. So now, like just again, history's repeating itself. It didn't work for David Zazlove. Well, can it work for David Ellis? I would argue that NFL football and the CBS Procedureals and all of the stuff and the Taylor Sheridan shows, that is a much more compelling add-on to HBO than say yes to the dress. Absolutely. There is definitely a lot of content. But remember, both of these services are generally lightly watched. I mean, neither of them have really dramatically grown their viewership. If you look at the combined share of streaming viewership, Warner Mount, as we're now calling it, it is officially Warner Mount on this show, 8% of viewership. If you took last month's numbers. Now, YouTube at-- Well, you're leaving off linear TV in that. It's obviously much smaller if you look at the combining linear TV. You're looking at purely with streaming. Yes. If you look at the linear TV plus streaming, Warner Mount is at 13.7%, which would be the industry leader above YouTube at 12.5%. And Netflix is down there at 8.8. But a good chunk. But most of that is linear. Most of that is linear. Yes. So, yes. So. It's actually not just CBS. It's also all the cable networks. It is. It is. But when you look at viewership of the CBS shows, they are still very highly rated. And obviously, they have NFL and CBS, Paramount Plus. Right. So, my point is, they still have a ways to go in streaming engagement. I get your point. But I want to specifically hone in on this debt question. Because you are rightly raising the fact that we just went through this with Warner Discovery. And they spent three years pairing down this debt. Today, Andy Gordon, the COO is talking about $6 billion in cuts. But Ted Sarandos told Lucas this weekend, and he's been saying it for weeks now, that he thinks they're going to have to cut $16 billion. So, where does you financial analysts? Where do you come down on this? Because $79 billion in debt, and where they are in EBITDA, and 12 billion or so, that doesn't match up. So, do they have to cut $6 billion? Do they have to cut $16 billion or is it somewhere in the middle? How many people work at CNN, Matt? - 3,000. - It's about 3,000. Correct. And I think we can both agree. And I feel bad saying this to everyone who works at CNN. But my guess is that number could be 2,000 or could be 1,500. Now, why didn't David Zazlove do this himself? Like, why do you need this transaction to do that? And my sense is that the media industry, the legacy media industry is undergoing seismic change with or without M&A. Like, these companies need to change their behavior. The underlying fundamentals of this business, whether it's subscribers to multi-channel cable, I mean, we can talk about cord cutting and what charter's doing? - Let's not. - We need, please. Let's not. But the reality is, people keep watching less and less linear TV, especially outside of sports and news. And so the core entertainment business that supported this is under pressure. It's going to, the only way you can't grow revenues. So you have to keep cutting costs. And so cutting costs is a way of life with or without transactions. And so what I guess I'm sort of pointing out is, sure, you can look at 6 billion as synergies. The reality is both of these companies needed to cut billions of dollars of costs with or without a merger. - You like when people get laid off. You like firings. - I would say all of these companies that we follow, and I don't only think just legacy media. I mean, you've seen Mark Zuckerberg do it. You've seen Daniel Eck at Spotify do it. Big companies get fat. And it's just sort of the problem of big companies is that you end up getting an overhiring and having too many people. And I think if you look at what Elon has achieved, certainly with acts. I remember everyone said X was no longer going to even function. - Do you want the X version of Warner Brothers? Do you want someone called it Ellis Slop? Are we going to lean or are we going to start to have Ellis Slop? (laughs) You have no answer for that. All right, to your point, Ellison says this is not about consolidation. This is about reinventing the business. What does that mean? It is about consolidation. He said in the same conversation that HBO Max and Paramount Plus are merging. That's consolidation. He said over and over again that the corporate teams are going to consolidate. He's talking about real estate synergies. That means selling off one or both of these lots. Like that is consolidation. - They may aspire to make 30 movies. They may aspire to not cut back on their streaming, programming, meaning TV show or TV series and sports investment. But remember, 70% plus of this company is linear television. We just talked about the merging of all of the discovery and Turner cable networks with all of the Paramount cable networks, meaning the old MTV, Nickelodeon networks. There's going to be billions of dollars of cost cutting. CNN and CBS news coming together. These are all huge cost cuttings. - Do you believe Paramount, six billion or do you believe Ted Cerandos, 16 billion? The reason I'm harping on this is because that is hundreds and hundreds, thousands of jobs. And that is what people in Hollywood who listen to this show care about most. I guess what I'm getting at is it's not just a, hey, we're going to cut six billion tied to this transaction. These companies need to get substantially smaller because of how this business is changing. Now, I mean, every one of these Disney needs to fire thousands of people. Like everybody needs to get smaller in their legacy linear television businesses. These businesses are not quote unquote fixable. I mean, even David Ellison was, I think he was very honest. We're not going to change the, like we're not going to make the linear business grow. We hope to slow the rate of decline. We'll see. I mean, obviously that is the big question. Can they actually slow it? When you saw what happened with Warner, obviously it ran away and got far worse, far faster than they ever expected. And I think that's going to be the question. So when you say six or 16, what really the question is, is how fast is the core business eroding? And how much in order to sort of right size the leverage, how much do they have to cut and how fast? Discovery couldn't do it fast enough. And that's why numbers just kept sinking, right? Like they could not cut fast enough. It's hard to cut at a huge rate. Like it's hard to run a business, slashing costs, firing people. Like it is not easy. It seems like it will be larger than six billion. Given the 79 billion dollars in debt, which is an amazing number to even say. And the fact that they-- Look at the movie business. I mean, look the movie business. Well, but that's not where they're cutting apparently. 15 films per studio. The question now is, as you go to 15 theatrical movies and then in theory of this closes, 30 theatrical movies, I'd love your reaction. But to me, it's never been more unpredictable. Tracking no longer seems to mean anything. The average movie seems to be, or most movies seem to be underperforming. There's a few outliers that blow out expectations to the upside. But box office is running 25% below pre-pandemic. Attendance is down 50% from pre-pandemic. Like the movie business is in deep-- The theatrical movie business is in deep trouble. And so trying to execute on 30 films in that environment, it seems on the one hand, it seems somewhat batched crazy. But do you believe it? Is the question. Ellison's going to say whatever he needs to say now to get people in Hollywood OK to be OK with this and to get regulators off his back. Do you actually believe it? I think it's the idea-- I mean, 30 theatrical films would essentially mean you're going to have movies in theaters competing against yourself, right? Because that's every other week putting out a movie. So you're literally going to movie stay in theaters three to four weeks on average, in terms of decent amount of screens. You're literally competing against yourself. That seems a little far fetched to believe now. And we have an example with Fox, where Dizzy paid a lot of lip service at the beginning, and then ultimately Fox became a shell of itself. I will say 30 films, though. Are we talking 30 wide release, meaning big pictures? Are we talking 10 or 15 more art housey films? Probably not. Let's see what actually occurs. I mean, my guess is there's a lot more nuance that Ellison and his team are not getting into. I'd be really surprised if there were 30 Mission Impossible Scale films-- Of course not. --over the course of eight. I mean, they don't have a specialty division, although Warner's has now quasi-started one. So there isn't like a search lighter focus to pump out five to eight of those per year. Maybe they'll launch one. But Ellison seems to be focused on the intellectual property driven-- at least movies that could do a couple hundred million dollars in theaters. But again, those don't grow in trees. You have to either-- It's hard. It's actually harder than it's ever been, actually. I think that's what no one's talking about is, this isn't a David Ellison problem. This is an industry problem. I mean, across the board, we're just not seeing movies perform. And even on the TV show side, the amount of shows that are, quote unquote, breaking through, I think that's really what we want to see is, how does Paramount combined with Warner? Do they just push these together? I mean, there is a pretty decent overlap between these two services. How do they bring them together? Is there-- they say less than Netflix. There is. There is meaningfully less than Netflix. But there's still a-- I mean, there are still a substantial overlap. And they are-- And they are complimentary. Paramount Plus has more of the populist kind of CBS-style shows and HBO Max specializes in premium. And they say HBO should stay HBO. That's a quote from David Ellison this morning. And OK, what does that mean? Does that mean HBO is just going to continue putting out a few shows per year and focus on the quality? Are they going to go back to pumping out stuff from Max? Like they were. And they still are in certain ways. What does that actually mean? They've really scaled back on Max. I mean, yes, the pit was sort of-- it comes from that world. But I mean, I think most of what you've seen, the shows like Hacks and-- they've really scaled that back pretty dramatically. And so I would be surprised. I mean, look, David Ellison is in an execute. I mean, this is all a show me story and execution. I mean, there's no historical proof because Skydance was such a small company. And they haven't had the time yet at Paramount to prove it. There's no historical basis to know whether they can do this or not. This is, I mean, any investor buying the stock today, you are making a bet that David Ellison can execute in a way that other executives in the space have failed. And he has no experience on his own of having done this. Look, he's got wild ambition. And he's got-- And his father's money. He's brought in some great executives around him. There's no doubt about it. He's definitely brought on and continues to hire from across the industry. So he's hiring interesting new people. He's definitely shaking things up. I mean, whether that's on the revenue side with someone like Jay Ashkenazi, whether it's looking at Cindy Howlin coming in, streaming how she works with Casey. I mean, I heard you and Luke is talking about it on Friday. I don't know how all of that works out. Well, the first thing is they got to reassign them. Casey's deal is up in 2027. And they got to make sure he and his team stay. It's tough. They've lost people. They lost Taylor Sheridan. They are going to have to stand up and say, we are committing in these areas. I bet they will in H.B. Look, all of Wall Street wants to know because this is $12 billion of EBITDA. It's $12 billion of EBITDA in 2028. Can it be 14 or 15 on its way higher? Or is it, are we going to replicate what happened at Warner Brothers where that was the high water mark and they never were never able to actually grow? There was always like, there was like a bowling towel of excuses of why they didn't live up to expectations. And that's what Wall Street's going to be focused on. This episode is brought to you by the Walt Disney Animation Studio, Zootopia 2, now nominated for the Academy Award for Best Animated Feature. The Hollywood Reporter hails Zootopia 2, knocks it out of the park with its dazzling visuals, sophisticated humor, and genuine emotion for your consideration for Best Animated Feature. How do you merge this entity, these two entities together? You and I are going to put on our McKinsey hats here and consult how, if you were charged with taking $6 billion to $16 billion somewhere in the middle out of this company, how do you do it? - I mean, look, you have on the linear television side, you have dramatic overlap, right? I mean, there's people doing the exact same jobs all over the world. There is going to be, unfortunately, there's going to be substantial reductions. Even-- - So they may be-- - That is not, I mean, they basically don't program these networks very much anymore. But anyone who's selling ads for the combined entity is instantly duplicative. - Before they're all taken out by AI, but that's the seven. - There's also subscriptions, Matt. There's a subscription team. There's a licensing team that licenses this content. I mean, on the film side, there's people that book movies into theaters all around the world. I mean, there is-- - Yeah, I know. The attribution teams are all vulnerable. - Marketing. - Marketing as well, though-- - Technology. - The marketing is-- - Yeah, but the marketing is more attuned with the creative team. The marketing people are in those green light meetings and determining how they can sell a particular movie. I could see them wanting some distinct marketing people for each of these sides of the content production. - I mean, maybe the Warner team survives, in not all cases, well, the Paramount team surviving is something-- - Oh, that's still a joke here. Is that the Paramount people are-- That company's smaller than Warner Brothers. And if you look at the current situation in film, you'd probably want to bet on the Warner side, rather than on the Paramount side. Now, the deciding factor here could be that the Paramount people are all Ellison people now. So he probably has more confidence in the people that he's hired rather than these people that he's gonna inherit. But who knows? - There are a lot of redundancies. So that's just step one is just the redundancies. Step two is running and marketing two streaming services obviously doesn't make sense. You've seen what Disney's done with Hulu, where Hulu still is something you can buy and add on, but they're essentially getting rid of Hulu as a separate app. They're getting Hulu, all of the infrastructure of Hulu was essentially being folded into Disney Plus. - The point is you have to save costs on these two services now that can be marketed as one. And you see what they did with Disney Plus. They effectively made it so that the bundled price was $1 more. And so they essentially sort of got you into buying a bundle of the two of them while they phased one out. I could imagine something like that. Like if you're an HBO and a Paramount plus subscriber, it's only $1 or $2 more. And you start to, you know, over the course of maybe 18 months or two years, you essentially combine them and then look, maybe there's still a premium version of HBO. Like I think it's unclear whether it'll all be part of the core service because they are very different, you know, in terms of the content. And so I think it'll be interesting to see how they decide to do this and do they literally, even if they combine them, are there different price points for different types of content? - Okay, where else do you cut? This is McKinsey. You gotta do your best here. You're not paying you to pay lip service. You gotta suggest smart cuts. - These are two big studios with two large development departments. There is no- - That's where the creator comes from though. - Sure, but, you know, you don't need, in order to make projects, you're gonna call that, right? You're gonna take the best projects out of that development. You're not gonna have the same, you're not gonna have the same overall deals with talent. You're gonna pick the best ones. - So you think that the talent, you think the talent overall deals and the talent spending will go down? - I mean, I would assume you're gonna choose who is most important to your long-term franchise when you take two huge organizations that do this. There has to be the ability to rationalize that. But look, all of this is at the same time you're doing all of this. I think we can both agree, Matt, both of these companies under-invested in technology and under-invested in marketing. Like, there was, and even actually, under-invested in content. Like, there was not enough to do with either of these platforms on their own. - But that's a cost, you're adding cost here. - Correct. - Okay, but, so you, but let's go to the cutting. So obviously, if you are gonna have one platform, everybody associated with the Paramount platforms or the HBO platforms, whichever one they choose, the other side will just go away, right? I mean, Ellison has these grand plans to sprinkle his father's technology dust on this company and turn it into the best user interface, the best technology. So-- - You're gonna have one tech stack. - Right. So all of the HBO Max and Bleacher Report and Discovery Plus platform tech stack that has been developed over the past five years, that's all going away. - I think it is highly likely that that is going to disappear. Now, it's possible everything moves to that, but I would assume given Ellison's focus on rebuilding the tech of Paramount Plus, I would presume that the Warner Brothers tech moves over to Paramounts and you basically just literally obliterate that entire part of the company. - So you saved a billion dollars and you fired thousands of people that work on that. So where do we go next? - Cloud savings. I mean, you think about, you know, the overall, like these companies are spending, there's a tremendous amount of infrastructure spending that they're both spending duplicatively. So, you know, like I'm not gonna break it down point by point for you, but there is no doubt that the overall spending of these companies can come down, not just of these companies. Every company you look at in this space could bring down costs pretty dramatically. This transaction just gives you a lot of opportunities to remove the duplicate costs. The question's gonna be though, and I wanna keep coming back to this in harp on it. How much of it is incremental? Because they do have to increase spending in many areas. Like, you know, you mentioned, you know, it was, you look at the NFL costs. NFL costs are going up. They have to, you know, they just invested in UFC. They're investing with the Duffer Brothers. They're investing in the cell- - By the way, they confirmed my speculation from Friday that yes, they say they can put UFC on their new cable channels like CBS and keep those more relevant with their sports, which is smart. You're gonna see the UFC on HBO, I believe. - Yeah, makes sense. I wanna get into five years from now. What is success here? Is it just staying alive? Is it just preventing another sale? What is gonna cause David Ellison to, you know, be looked at in a positive light from his father in five years? - It's a little overly simplistic, but I think most people that I talk to in the investing world believe Disney has enough scale to be a survivor. - Mm-hmm. - But nobody believes Disney's going to get sort of, will evaporate. I think there's plenty of people that believed Paramount on its own or Warner Brothers on its own might evaporate, especially Paramount. I think Warner Brothers because of HBO sort of, everyone thought they could hang on, even if they were smaller. - Well, they've been transitioning the licensing model to the HBO Max model in all these different countries. So they've been converting a bunch of subscribers and growing. - But on the flip side, I think that wasn't the case with Disney. And so people would say, okay, Netflix is a survivor, Amazon's a survivor, Disney's a survivor, there's gonna be one more. And so the question really in terms of how we're gonna judge whether this is successful or not is, do we look at this in four or five years and go, God, because of this merger, they were able to, basically leapfrog into a position of being a survivor. Are they a player long term in the streaming wars? Can they really compete with the bigger companies in the space? Because again, to your point, they're still sort of small, right? Like they are not a huge player. They're a huge player from, you know, in terms of linear television footprint. They're now a huge player. - You're a huge player in terms of, they are the number one distributor. But if you don't and that's getting smaller, they are not. - Correct. So can they actually leapfrog into being a survivor in the streaming wars? That's gonna be what determines whether David Ellison is a success or a failure in five years other than, you know, I guess from a Zazloff standpoint, selling the company made him successful. But, you know, certainly from an operational standpoint. - Let's not talk about David Zazloff today. I mean, that's a whole separate thing. I mean, this fucking guy, going to the New York Times and bragging about how exciting this deal was and how thrilling and exhilarating it was when you are about to close a deal that is gonna result in tens of thousands of people losing their job. Like, dude, read the Fing room. Don't do that. Like, who the, like just don't do that. - David Zazloff's, but look, David Ellison's job is to grow shareholder value. So can he grow shareholder value over the course of the next five years? And I think what's gonna be, unless he's selling it, I don't think he's selling because I think he's 43 years old. He's gonna do this for the next 40 years. So the definition of success for David Ellison. - Unless he has to sell, by the way. Unless the debt consumes him. And daddy says, no more son. And the Saudis are like, what did you do with our money? And these debt lenders are like, wait a second. You promised X and it's X minus two billion every year. Like, then that's a problem. - But Disney stock is down over a decade. I mean, we can go stock by stock. But this has been a disaster. Can David Ellison actually grow shareholder value? You've got a stock at $13 today. They're investing more in this transaction. It's 16 when it closes. Will this stock be 20 in five years, 30 in five years, or 10 or lower? Like, that is gonna be really what you determine, whether he is successful. - From your perspective, from a financial perspective. - From a, is he good at making movies or is he good for Hollywood jobs? I'll leave that to you and Lucas. But from the standpoint of Wall Street, can he make people money? Because right now, the tech company, as you know, Netflix has made people money. Obviously Google with YouTube has made people money. All of the other companies, other than Zazlove, who sold in Fox, which really narrowed it down by selling. Like, you think about the only two companies that have made money with through transactions and simplifying. Nobody else on the core space has made money over an extended period of time right now. Can David Ellison be in that category of actually investing in being willing to forward invest? Which is not just gutting for cost savings, but really investing to build. And what I mean by build, meaning he has to make it so when Matt goes home and you're hanging out with your family at night, you go, "Hey, let's turn on whatever it's going to be called. "One-or-Mount, Paramount Plus, whatever the name of this thing "is going to be called." Is it something that you turn to every single day? And look, we're moving into a role of AI where content creation is going to get easier. YouTube, which is already the dominant player in the space is going to get far, far stronger over the course of the next five years. What does that mean? How do you not lose share to YouTube and others over that period of time? And look, again, the beauty of Netflix is, and even with the transaction they were trying to do, they were never tied down. They never had to think one second about linear television. All of their energy was focused on streaming. Ellison has to skinny down the linear business and at the same time build for the future in streaming. That's the challenge that Igers had. It's Josh Demaro's challenge now in the new company. Like, that is the challenge facing David Ellison is how do you balance these two and actually grow the net business over the course of the next five years? Well, I look forward to you cheerleading them on in cost-cutting and consolidation while doing pull-ups. Thank you for joining us. Thank you. Okay, we are back with the call sheet, Craig. One thing we didn't really get into is the whole question of what this merged streaming service that Paramount is now going to own that includes HBO Max and Paramount Plus. What are we going to call this service? Do you have thoughts? I think they should just call it HBO. I think they should kill Max. There should be no Paramount name attached because that doesn't mean anything. I think it should just be called HBO. Interesting you say that because obviously, there's a long-tortured history here. It was HBO. Then it became HBO. Go and HBO. Now when it was the old regime, then the AT&T people created HBO Max. Then the Warner Discovery people said, "Oh, no, no, no, we don't need HBO Max anymore. We'll just call it Max." Then that didn't work. Then they went back to HBO Max, which is where we are today. My prediction is, I actually think they are going to keep HBO Max and fold Paramount Plus into HBO Max. What HBO, the name HBO Max does is it basically communicates its HBO premium, but also a bunch of fun other stuff, like Paramount shows and things like that. So I understand that, but I do think HBO ultimately just sounds the best. It's a brand. That was the whole problem with Max. There was not 50 years of brand identity to help sell the product. Now, obviously, the previous regime thought that that brand HBO was limiting as much as it was additive and for a number of people. HBO is not for them. They do not like the HBO brand, that content. So they don't want it even if there's a whole bunch of other stuff. That's why I think that they probably won't go with just HBO. The question is, do they lean into maybe another brand they have, like calling it CBS or calling it HBO CBS or something like that? I think that's too confusing. I think that they go with a brand that is out there, HBO Max, and then it becomes like Disney, where there are tiles. There is a CBS tile. There is a MTV music tile. There is an HBO tile. So you can keep these sub brands separate, but the overall product is HBO Max. What is the actual official name of this new company now? Is it Paramount? Is it Paramount Skydance? Is Warner Brothers involved in the title? Honestly, I don't believe they have decided yet. I've heard speculation. It may be something like P-Sky Bros, which sounds like terrible. P-Sky Bros as the actual name of the company. Paramount Skydance is the current name of the company. Yes. But their stock ticker is P-Sky. Sure. So I'm not talking about the stock ticker. They keep referring it to people who are making fun of the town hall, where they kept saying P-Sky, and they're like, "What? What does your nation have to do with this?" But yes. So they may incorporate the Warner name, or it may just be that everything becomes a subsidiary of a Skydance company, like they say on the Paramount Monarchers. It's Paramount, a Skydance company, or Paramount, a Paramount Skydance company. I don't know. But, okay. The bottom line is I don't know. When the Batman 2 comes out, or the Batman 3 comes out, yes. Will that be a Warner Brothers movie, or will it be a Paramount Skydance movie? It will be a Warner Brothers label movie. Just like when the Alien movies come out, they come out under 20th century studios, which is the Fox label that Disney bought, and they just dropped the Fox off of it. But ultimately, it's distributed by the Walt Disney company, the Walt Disney distribution company. It will likely be that the Warner Brothers movies still have Warner Brothers as their moniker on it. It'll just say Warner Brothers, a Paramount Skydance corporation, or a Peace Guy Bros corporation, whatever they end up calling it. Well, it's all very exciting. Get excited for corporate branding, man. It's huge. But I do think my prediction HBO Max will stay. Okay, that's the show for today. I want to thank my guest, Rich Greenfield, Bruce Craig Horback, artist, or John Jones. And I want to thank you. We'll see you a couple more times this week.