The news: The Justice Department approved Paramount’s $111 billion acquisition of Warner Bros. Discovery, clearing the way for a mega-merger that will alter the media landscape for consumers and advertisers alike.

Paramount called the deal “pro-competitive” in a statement; CEO David Ellison has promised to release 30 films annually in theaters in an attempt to address a chief concern raised by actors and critics.

How we got here: It is perhaps not surprising that the DOJ would clear the acquisition. President Donald Trump and other officials have expressed support for the deal; Meanwhile, attorneys general in various states are attempting to block the deal on antitrust grounds.

What this means: A consolidated media landscape will have several impacts on the media and advertising industries.

• The merged company will have significant overlap between assets—such as ownership of news networks CNN and CBS—which will likely lead to layoffs or even the closure of certain programming, limiting certain types of inventory and leading to fewer media jobs overall.
• The company’s control of multiple streaming services like HBO Max and Paramount+ will give it significant leverage during advertising negotiations. Advertisers will have fewer choices in both broadcast and streaming partners.
• The consolidation of key assets HBO Max and Paramount+ will boost the combined entity’s subscriber base and market power. Both services rank among the lowest in terms of subscribers and total advertising revenues, per our forecast, but a bundled service would send revenue growth for both services—especially Paramount+—sharply upward.