Four Democrats in U.S. Congress have reportedly asked the U.S. Department of Justice (DOJ) to review the Warner Bros. Discovery merger according to The Los Angeles Times.
The outlet says the representatives allege that the deal, which saddled Warner Bros. Discovery with more than $50 billion in debt and led to some extreme cost-cutting, is responsible for “hollowing out an iconic American studio”.
In a letter on Friday to Attorney General Merrick Garland and Assistant Attorney General Jonathan Kanter, the lawmakers cited ‘harm’ caused by last year’s union of the two media companies – leading to layoffs of thousands of employees. The merger also reportedly heightened barriers to entry in the media and entertainment industry.
Warner Bros. Discovery has also reportedly wiped out hundreds of millions of dollars in programming in recent months – projects that would’ve provided jobs for hundreds of workers. Rep. Joaquin Castro says:
“There have been massive layoffs. Content creators, in many cases, have been hurt, and some consumers are holding on to TV and streaming subscriptions that feature less content than a year ago.”
Castro was joined by Sen. Elizabeth Warren, Rep. David Cicilline and Rep. Pramila Jayapal in sending the letter. Despite the criticism though, it is said that it would be highly unusual for the DOJ to try to unwind a merger which has already received the blessing of regulators.
Other media companies have similarly been cutting thousands of jobs as Wall Street has become concerned about the high cost of launching successful streaming services.
Source: The Los Angeles Times
