For decades, Los Angeles has been the creative and commercial center of the global entertainment industry. From the studio lots of Hollywood to the tech campuses reshaping the entertainment ecosystem, the city is home to a wide variety of media, production, and talent companies.
In the city’s fast-paced environment, trends are always changing, and it is now evident that the entertainment industry itself is in the midst of a profound transformation, driven primarily by streaming dominance, fragmented audiences, artificial intelligence, and the economic pressure to achieve scale.
In the past decade, the structural factors reshaping film and television entertainment, including cord-cutting, the rise of short-form creator content, and the emergence of AI-driven content, have combined to accelerate the necessity for change. Entertainment companies are responding to these challenges through M&A activity. Scale provides negotiating leverage with distributors, the financial capacity to invest in premium content, the tech infrastructure to personalize viewer experiences, and the development of IP that forms the building blocks of long-term value creation. In the current environment, companies that cannot achieve meaningful scale through organic growth are increasingly turning to M&A as a strategic necessity.
For Los Angeles-based companies, advisors, and investors, it’s essential to understand the drivers, trajectory, and risks of this consolidation wave. In this article, you will discover the answers to these key questions:
• What deals have defined the recent landscape?
• What forces are pushing companies to the negotiating table?
• What should LA entertainment and media executives know as they navigate pivotal dealmaking years?
Current State of Entertainment & Media Consolidation
The ownership landscape in entertainment and media has changed drastically over the past five years. Peaking in 2021, the industry recorded roughly 3,700 deals with an aggregate value approaching $234 billion, according to S&P Capital IQ. In 2022 and 2023, however, volume declined due to rising interest rates, regulatory headwinds, and macroeconomic uncertainty. By the first half of 2024, deal and joint venture activity rebounded sharply, surging more than 80% compared to the second half of 2023. This signaled a renewed appetite among both strategic buyers and financial sponsors, and by late 2025, a string of major deals arose.
Several major transactions have fundamentally altered the competitive landscape in the past two years, with implications that will reverberate into 2026 and beyond.
Skydance Media Merges with Paramount Global
LA-based Skydance Media, led by David Ellison and backed by RedBird Capital, closed its merger with Paramount Global in August 2025. The combined company now trades as Paramount, a Skydance Corporation, pairing Paramount’s library and distribution reach with Skydance’s production engine and tech-forward approach.Industry observers widely viewed this as an opening move in a broader wave of deal activity.
Paramount Skydance Wins Warner Bros. Discovery (WBD) for $110.9 Billion, Topping Netflix in Landmark Bidding War
Warner Bros. Discovery (WBD) sparked a Hollywood bidding war. In 2025, Netflix agreed to buy WBD’s studios and streaming assets for $82.7 billion, but Paramount Skydance countered with an all-cash offer for the full company. After months of revisions, Warner’s board accepted Paramount’s $31-per-share proposal in late February 2026. Paramount agreed to cover WBD’s $2.8 billion breakup fee to Netflix and set a $7 billion reverse breakup fee pending regulatory approval. For the entertainment industry, this meant the consolidation of two significant brands under an LA-based owner.
How Consolidation Is Reshaping the Industry
Consolidation is changing the industry’s operating model, not just its ownership. As a handful of streaming platforms amass deeper IP libraries, the middle market is getting squeezed, forcing mid-sized studios and independent streamers to partner, sell, or specialize.
Disney’s merger of Fubo (to be combined with Hulu + Live TV) created the sixth-largest pay TV company in the U.S., with 6 million subscribers in North America. The Walt Disney Company owns approximately 70% of the combined entity, which continues to trade on the NYSE under the ticker FUBO. Each move follows the same strategic logic: consolidate distribution while investing aggressively in the technology infrastructure that underpins it.
The buyer universe has also widened. In 2024, more than half of media and entertainment transactions involved buyers from outside traditional Hollywood, demonstrating that tech platforms, private equity, and sovereign wealth funds are now shaping outcomes. The $10 billion sale of the Los Angeles Lakers to Dodgers owner Mark Walter also highlights the trend of sports rights, live events, and venues becoming core media assets pursued by capital.
Driving Forces Behind Consolidation
Economic Factors
The macroeconomic environment has shifted in favor of dealmaking. After a period of elevated interest rates that compressed deal valuations and raised financing costs, the Federal Reserve’s rate-cutting cycle has improved borrowing conditions. Goldman Sachs projects multiple additional rate cuts that could lower the terminal rate between 3–3.25%, providing further tailwinds for leveraged transactions. Private equity dry powder remains near historic highs, estimated at $4 trillion globally, creating significant deployment pressure that will continue to drive financial sponsor activity in entertainment assets. The deterioration of linear TV advertising revenues has simultaneously created distressed asset opportunities as legacy media companies restructure their balance sheets and separate declining businesses from higher-growth streaming operations.
Technological Advancements
Artificial intelligence is one of the largest components driving M&A strategy in entertainment. Companies are racing to acquire AI capabilities, such as content generation, personalization tools, production automation, and IP licensing platforms. AlixPartners projects that gaming companies that successfully integrate AI will command valuation multiples two to three times higher than laggard peers by the end of 2026.
AI is simultaneously compressing production costs, creating new monetization pathways, and raising urgent questions about IP protection, residuals, and workforce displacement, reshaping deal terms. The $55 billion take-private of Electronic Arts by Silver Lake, the Saudi Public Investment Fund, and Kushner’s Affinity Partners reflects the premium the market places on interactive entertainment IP that can serve as a platform for AI-driven experiences.
Shifts in Consumer Behavior
The global streaming market is set to surpass $165 billion in 2026, but subscriber growth has decelerated to an estimated 5%, forcing platforms to compete on content depth, personalization, and complementary formats. Consumers today expect seamless access to short-form, long-form, live, and creator-driven content within a single platform experience, which drives platforms to consolidate and collaborate. Companies that cannot subsidize content costs across a sufficient subscriber base face structural disadvantages for which M&A is often the only credible remedy.
Regulatory Environment
The current administration’s regulatory posture is more permissive toward media consolidation. In July 2025, a federal appeals court ruling lifted the FCC’s ownership limits for the top four broadcast stations, opening the door to aggressive consolidation in local television, evidenced by Nexstar’s announced $6.2 billion acquisition of Tegna. Dealmakers widely expect the current regulatory environment to remain favorable through 2026 and into 2027, creating a window for transactions that might have been too risky under prior administrations.
The Netflix–Warner Bros. transaction has tested the limits of deregulatory sentiment. Bipartisan congressional opposition, union pressure, and White House intervention signal that even in a permissive environment, deals that threaten to dominate an entire distribution channel will face meaningful scrutiny. Regulatory risk remains a material factor in deal structuring, timeline planning, and valuation assumptions for any major entertainment transaction.
How EisnerAmper Can Help
EisnerAmper’s Sports, Entertainment, and Media practice brings deep sector knowledge to every phase of the M&A lifecycle. We understand that the financial and compliance issues facing entertainment companies are unique. From film tax credits and revenue sharing arrangements to collective bargaining implications and IP valuation, we take a customized approach to meet each client’s specific needs.
Our services for M&A transactions in entertainment and media include:
• Buy-side and sell-side financial due diligence
• M&A tax structuring, diligence, and modeling
• IP valuation and allocation of purchase price
• Compliance and risk advisory
• Post-merger integration support
• Private client and business management services
The entertainment and media companies that will solidify their place in the new industry landscape are those that combine strategic ambition with disciplined execution. EisnerAmper is proud to serve as a trusted advisor to the LA entertainment community as it navigates this period of transformation.
