The news: Paramount closed its $110 billion acquisition of Warner Bros. Discovery, creating a new media giant called Skydance.

As part of the deal, Skydance must release at least 30 theatrical films annually for two years and 32 in the following years. The merged company is also seeking $6 billion in cost cuts in the next three years—likely eliminating thousands of entertainment jobs.

Skydance now controls major movie studios Paramount Pictures and Warner Bros.; streaming services HBO Max, Paramount+, and Pluto TV; news organizations CBS and CNN; and cable networks TNT, HBO, MTV, and Nickelodeon, among others.

Why it matters: The deal puts Skydance on par with competitors like YouTube, Netflix, and Disney in terms of audience and influence. Skydance now yields significant pricing power that could drive up CPMs; that scale and consolidated inventory could restrict access to premium streaming, sports, and entertainment audiences.

But Skydance still has many challenges ahead:

• Offsetting declines in traditional linear revenues as audiences and ad dollars shift to streaming
• Proving the merger can create value without weakening the company’s creative output
• Maintaining editorial independence at CNN and CBS, especially with heavy scrutiny of CEO David Ellison’s relationship with President Donald Trump
• Competing with Big Tech rivals like Amazon and Apple, which have become prominent players in streaming and entertainment
• And managing a roughly $80 billion debt load that could constrain operations—made all the more difficult considering the need to invest in growth areas like streaming.

Implications for marketers: A consolidated company that controls some of the biggest names in entertainment could simplify media planning by reducing content fragmentation. Marketers may be able to reach larger audiences by working with a smaller set of central players.

But that simplified planning could come with increased competition for ad space and less leverage in pricing negotiations. Skydance now wields significant power that will likely drive up costs. Marketers should prepare for tougher negotiations and scrutinize whether broader bundled buys deliver enough incremental reach to justify higher prices.

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