INSIDE ELLISON'S MIND

It's scary in there.

Happy Thursday Peaceniks. Are you ready to peer inside David Ellison’s mind?

Last week, I got ahold of the investor deck that David Ellison and Paramount are trotting around board rooms, Saudi Arabia, and China to raise the capital he needs to acquire Warner Bros. Discovery for $110 billion.

It’s bonkers.

This chart shows the revenue assumptions projected in Ellison’s investor deck, compared to the current revenue trajectory of both companies.

Here, you’ll see the EBITDA assumptions they’re selling their backers, juxtaposed with the current state of profits for Paramount and Disco Bros.

In the same breath Ellison and his Red Bird benefactors are telling everyone that they will defy revenue and EBITDA gravity, dramatically increase the combined studios’ movie output, and make two unprofitable streaming platforms suddenly profitable… They are also swearing they’ll do so without major layoffs and without selling either studios’ Hollywood lots.

Yet their “synergy” assumptions tell the opposite story - identifying $24 billion in cuts to overhead, involving massive tech backbone savings (for two services with truly awful tech); $4 billion in real estate sales (while not selling either of the most valuable pieces of real estate they own); and $12 billion in cuts to “business services,” “marketing optimization,” and “enterprise resource planning.”

Does this sound a lot like Elon Musk’s DOGE promise to cut $2 trillion from the federal government, which actually resulted in the government increasing spending? Just me?

There are many reasons to combine these companies - at the right price and with the right plan.

But $110 billion is three-to-four times more than Disco Bros is actually worth. This deal will result in Paramount loaded with $80 billion in debt. And it will leave two of America’s most storied Media companies (as well as two of our most important news organizations) beholden to Saudi Princes and the Chinese oligarchy - something both Ellison and Red Bird CEO refuse to admit.

This week on The Media Odyssey podcast, Marion Ranchet and I delve into this shell game, using Ellison’s own math - and words - to debunk his fantastical assumptions.

WATCH/LISTEN: APPLE PODCASTS | YOUTUBE | SPOTIFY

PLUS: We also got our hot little hands on a groundbreaking new study from The Harris Poll and Tubi - The Stream. It’s got some remarkable data on audience streaming preferences, including tellingly bad news for paid premium streaming platforms (you can download the whole report here FOR FREE).

WATCH/LISTEN: APPLE PODCASTS | YOUTUBE | SPOTIFY

Two reports. One chock-filled pod. Check it out and let me know what you think!

One more thing: have a great weekend!

ESHAP