You know that moment in a disaster movie when the ship's captain grabs the mic to say "everything's under control" while the water's already ankle-deep for everyone? Yeah. David Zaslav, CEO of Warner Bros. Discovery, just pulled exactly that move.
The guy called a Town Hall — that company-wide meeting executives love to use to fake transparency — to try and sell his own employees on the idea that merging with Paramount is the right move. The problem? The mood inside the company feels more like a wake than a celebration.
The Dream Salesman With No Audience
Zaslav is an interesting character. He's pocketed over $250 million in compensation in recent years while Warner Bros. Discovery melted in market value. WBD stock has dropped more than 70% since the Discovery merger in 2022. Seventy percent, my friend. If that were an investment portfolio, the fund manager would've been fired, sued, and exiled.
But in the American mega-media corporate world, the guy not only survives — he walks up to the podium, fixes his hair, and tries to convince everyone that this time it'll work.
It's like Walter White in Breaking Bad explaining to his family that his business is "totally safe." We know it's not. He knows we know. But he keeps talking.
The Context Nobody's Telling You
Let's get to what matters: why does this Warner-Paramount merger even exist as a possibility?
Because traditional media is bleeding out. Streaming doesn't make enough money. Linear TV is dying. And the big entertainment conglomerates built empires of debt that now weigh like an anchor around their necks.
WBD is carrying somewhere around $40 billion in debt. Paramount, for its part, has already passed through Shari Redstone's hands, nearly got bought by David Ellison's Skydance, and is now flirting with Zaslav the way people flirt out of sheer desperation.
The deal logic is that old story of "putting two drunks together to see if one can hold the other up." Cost synergies — read: mass layoffs. Combining content libraries. Scale to negotiate with advertisers. All nice and pretty on the PowerPoint.
But in practice? Media mergers have a disastrous track record. The AOL-Time Warner merger in 2000 is considered the worst deal in American corporate history. The Discovery-Warner merger in 2022 destroyed value. And now they want to do it again?
The Funeral Vibe
What strikes me most about this story isn't the deal itself — it's the fact that Zaslav needs to convince his own employees. That tells you everything.
When a company's CEO has to run an internal PR campaign to justify a strategic decision, things are bad. Employees aren't stupid. They know "synergy" is code for "your job might disappear." They've watched colleagues get laid off by the thousands over the past two years. They've watched projects get canceled, movies thrown in the trash for tax write-offs, and internal morale go straight down the toilet.
And now the guy shows up and says: "Trust me, it'll be different this time."
Damn, that's the textbook definition of Einstein's insanity quote applied to the corporate world.
What This Means For Investors
If you've got WBD or Paramount shares in your portfolio — or you're thinking about buying on the "merger thesis" — pay attention:
Nassim Taleb would say this is the kind of situation where the negative optionality is enormous. The downside of a poorly executed merger (again) is massive. The upside? Maybe, in an optimistic scenario, you recover some of the value lost over the past three years. Maybe.
Zaslav doesn't have real skin in the game. His compensation is bulletproof. If it all goes to hell, he walks away with a fat golden parachute and moves on to the next gig. The ones who foot the bill are the employees and minority shareholders — as always.
The question is simple: would you trust your savings to a guy who needs to hold a Town Hall to convince his own team that the plan is good?
I wouldn't trust him with my coffee money.
