California lawmakers are drawing a line in the sand regarding the massive Warner Bros Discovery acquisition. Senator Adam Schiff and Representative Laura Friedman sent a blistering letter to industry titans this Friday. They are demanding concrete, written guarantees that the pending deal will not decimate the local workforce. The move signals intense government scrutiny over a merger that could reshape the entire entertainment economy.
Protecting the Economic Engine of Los Angeles
The entertainment industry is not just about red carpets and premieres. It is the financial backbone of California. Senator Adam Schiff and Representative Laura Friedman directed their concerns specifically to Netflix co-CEO Ted Sarandos and Paramount Skydance CEO David Ellison. The lawmakers made it clear that vague promises are no longer acceptable.
The letter highlights the sheer scale of the sector at risk. This industry supports more than 680,000 workers directly and indirectly. It contributes over $115 billion to the economy every single year. Schiff and Friedman argue that a merger of this magnitude requires strict oversight to prevent a collapse in local employment.
Hollywood has faced a turbulent few years. The lingering effects of the 2023 dual strikes and the global pandemic lockdowns have already strained the workforce. Many production crews are still struggling to find consistent work.
There is also the growing threat of “runaway production.” Studios are increasingly moving shoots to locations with aggressive tax incentives like the United Kingdom, Canada, or other US states like Georgia. The lawmakers fear that this new acquisition could accelerate that trend if not checked immediately.
Senator Adam Schiff and Laura Friedman official letter to Hollywood executives
Concerns Mount Over Billions in Projected Cuts
The core of the anxiety stems from the aggressive financial strategies proposed by the acquiring companies. Mergers often lead to “synergies,” which is usually corporate speak for layoffs. The numbers outlined in the deal are staggering and have raised red flags across the state.
Paramount has outlined plans to reduce expenses by $6 billion over the next three years. Simultaneously, Netflix projects cutting between $2 billion and $3 billion in costs. When companies look to save that much money, payroll is often the first place they look.
Industry analysts predict that a significant portion of these savings will come directly from eliminating jobs. This does not just mean firing executives. It often hits the “below-the-line” workers the hardest. These are the camera operators, costume designers, electricians, and editors who make the movies happen.
Schiff and Friedman called these projected figures “extremely concerning.” They insist that any plan to save money must not come at the expense of the California workforce. They are asking for a strategy that balances fiscal responsibility with human welfare.
- Projected Financial Impacts:
- Paramount Skydance: $6 Billion in cuts over 3 years.
- Netflix: $2 Billion to $3 Billion in reductions.
- Worker Risk: High potential for redundancy in overlapping departments.
Executives Face Deadline to Deliver Answers
The lawmakers are not just asking for a meeting. They have issued a formal request for information with a tight turnaround. They presented the CEOs with eight specific questions that require written answers by February 15, 2026.
This deadline puts immediate pressure on Sarandos and Ellison to show their cards. The questions probe deep into the operational strategies of the new entity. Schiff and Friedman want to know exactly how the new owners plan to keep Hollywood central to their production goals.
One key area of inquiry focuses on investment strategies. The lawmakers want details on how the companies will actually grow high-quality jobs in Los Angeles. They are looking for a roadmap that shows expansion rather than contraction.
The legislators stated they expect public commitments that go beyond standard press release rhetoric. They want measurable actions that can be tracked over time. By setting a clear date, they aim to hold these massive corporations accountable before the ink on the deal is dry. This proactive approach is rare and shows how high the stakes are for the region.
Stabilizing the Local Entertainment Ecosystem
The impact of this deal extends far beyond the studio lots. A major studio contraction creates a ripple effect that hurts thousands of small businesses. This includes catering companies, prop houses, lumber yards, and digital effects studios.
When a major player like Warner Bros Discovery changes hands, the uncertainty can freeze the market. Vendors stop investing in new equipment. Landlords worry about lease renewals. Schiff and Friedman are trying to inject stability back into the market.
The lawmakers hope that the new owners will recognize the unique value of the Los Angeles talent pool. No other region offers the same density of skilled creative professionals. Keeping production in California ensures access to the best crews in the world.
Schiff has a long history of fighting for film tax credits to keep production local. Friedman has also been a vocal advocate for labor rights. Their combined pressure suggests that the government might intervene if the responses on February 15 are not satisfactory. They are fighting to preserve a cultural export that defines California to the rest of the world.
The letter serves as a warning shot. It tells the studios that while they focus on share prices and streaming subscribers, the government is focused on the people who actually build the products.
The request to Netflix and Paramount is clear and urgent. Senator Schiff and Representative Friedman have made a strong case that the health of the California economy depends on fair treatment for Hollywood workers. They are demanding written, enforceable commitments to protect jobs and sustain the industry. This is a critical moment for the workforce, and the clock is ticking for the CEOs to respond.
What do you think about the government stepping in to protect Hollywood jobs? Should studios be forced to keep production in the US? Share your thoughts in the comments below.
