Theaters on Thin Ice: Regal’s Support for Paramount Deal Raises Questions

Regal Cinemas CEO Eduardo Acuna has thrown his weight behind David Ellison’s $111 billion bid to create a media behemoth by merging Warner Bros. Discovery with Paramount Pictures. This endorsement from the second-largest chain in the US comes at an interesting time, with 12 states suing to block the deal on antitrust grounds.

The support of major theater owners like Regal and AMC Theatres is crucial for Team Ellison, as it allows them to claim that the merger won’t harm competition in the theatrical marketplace. However, this argument rings hollow when considering the facts: a merged WarnerMount would control an astonishing 30 percent of movies that have earned $100 million-plus at the box office.

The states’ lawsuit, led by California Attorney General Rob Bonta, hinges on the notion that a single entity controlling such a vast share of market would inevitably stifle competition. “Movie theatres rely on competition between Paramount and Warner Bros,” the complaint notes. “Through this competition, theatres incentivize creativity and quality, and they secure competitive prices and terms for themselves and for audiences.” By merging these two studios, Ellison would effectively gain control over a significant chunk of the market, putting theaters like Regal in an uncomfortable position.

Acuna’s statement defending the deal cites Paramount’s promises to increase production, release at least 30 movies per year with a 45-day theatrical window, and invest $30 billion annually in media content. However, these commitments appear to be more public relations spin than concrete guarantees. The fact remains that a merged WarnerMount would still wield enormous influence over the supply of product to theaters.

The implications for the film industry extend beyond this merger. As studios become increasingly vertically integrated, theaters are facing an existential crisis. With Regal’s support now on board, it’s unclear whether others will follow suit or continue to express concerns about the potential consequences of this deal.

Ari Emanuel, Adam Aron, and David Ellison himself have all weighed in with op-eds defending the merger. Meanwhile, a rival letter signed by Benedict Cumberbatch, Alan Cumming, and Benedict Wong has come out against it. The trial, scheduled for March 2027, promises to be a long and grueling one.

The fate of theaters like Regal, which emerged from bankruptcy in 2023, hangs precariously in the balance. As studios consolidate their power, smaller players will either be squeezed out or forced to adapt to a new landscape. The future of independent cinema is uncertain, with Paramount’s promises translating into tangible benefits or empty words designed to placate regulators and industry players.

The stakes are higher than ever before as this saga unfolds. Will Regal’s support prove to be a turning point in the deal’s fate, or will it ultimately prove insignificant? Only time will tell, but one thing is certain: the outcome of this merger will have far-reaching consequences for the film industry and its stakeholders.