Blake Lively’s lead litigators scored a pretty stunning near-total dismissal of Justin Baldoni’s $400 million countersuit for defamation and extortion. (He can refile the breach-of-contract claim if he wants.) Not surprisingly, the Times also beat Baldoni’s defamation claim over the article that revealed Lively’s sexual harassment claims, which will continue to be litigated. Eriq Gardner will have more on this tomorrow in WIH+. Runner-up: Rob Manfred, the MLB commissioner, whose TV ratings are up double digits this season just as he’s seeking a new broadcast deal for the Sunday Night Baseball package that ESPN dropped. Second runner-up: Naveen Chopra, the Paramount Global C.F.O., who bailed today for the same job at Roblox. Chopra, like other top Paramount executives, is financially incentivized to stay until the Skydance deal closes, so I read the exit as a sign that Chopra either a) doesn’t care about money and just wanted out; b) thinks the Skydance deal won’t close due to the Trump/F.C.C. nonsense; or c) received cash or equity awards from Roblox that made it worth his while. (I’ve heard it’s c but that’s not confirmed.) Also, can you imagine being C.F.O. of Redstone’s Paramount right now? Why not go to a media company that does have a future?

Speaking of Redstone, Kim Masters slipped me the invite list for this year’s Allen & Co. mogul retreat, always an interesting barometer. Shari, a recent fixture at the event, is not on the Sun Valley list this year, nor is her Paramount suitor David Ellison, who seems to be limiting his public appearances to UFC matches near Trump. Bob Iger is again invited with his four Padawans, Alan Bergman, Josh D’Amaro, Jimmy Pitaro, and Dana Walden. Usual attendees Jeff Bezos and Andy Jassy of Amazon are on the list, as are Jeffrey Katzenberg, Michael Eisner, and Michael Ovitz (presumably not rooming together!), and producers Jason Blum and Brian Grazer. Bryan Lourd and Chris Silbermann are invited from CAA (Silbermann grandfathered in from his ICM days). David Zaslav is there with Bruce Campbell, his chief revenue officer (no Gunnar), plus John Malone and Liberty’s Derek Chang and Mike Fries. Tim Cook and Eddy Cue of Apple are on the list, as are the Netflix trio of Greg Peters, Ted Sarandos, and Reed Hastings. Ynon Kreiz of Mattel is there. So is YouTube’s Neal Mohan, plus Rupert, Lachlan, and Wendi (!) Murdoch, as well as Fox’s C.O.O. John Nallen and Robert Thomson at News Corp. Music is repped by Daniel Ek of Spotify, Michael Rapino of Live Nation, and Casey Wasserman. Barry Diller and DVF are invited, and while there’s no Elon, tech dudes Dara, Mark, Satya, Sundar, Evan, and many more are there, presumably to laugh at the market caps of the legacy media people.

“I’m telling celebrities to get out of politics, man.” —Steve Stoute, the investor/consultant and music exec, revealing to the Times his advice to clients these days. Runner-up: “So, thank you for what you’re doing, for every script that you write, every scene, every story. Thank you for your work, your fire, your voices. And thank you for refusing to wait for permission. Thank you for continuing to lift one another up.” —Jane Rosenthal, the producer and Tribeca co-founder, forcefully championing women and nonbinary filmmakers at a star-studded Chanel event during the festival. Hmmmm. Rosenthal says stuff like this a lot, which is nice, but also… interesting… because a quick glance at her IMDb reveals she’s produced dozens of movies going back to Cape Fear in 1991, and she’s never produced or E.P.’d a film directed solely by a woman. Actually, there’s one: All We Had, a tiny 2016 title directed by Katie Holmes. Rosenthal’s not alone in that kind of double-talk, of course. Her comments reminded me of Holmes’s ex Tom Cruise and Scarlett Johansson giving back their Golden Globes in protest during the 2021 racism scandal despite having made only one film between them (2000’s Mission: Impossible II) with a director of color. Natalie Portman has also made great strides in the do-as-I-preach-not-as-I-do category of public posturing.

I talked to David Kramer, the new C.E.O. of United Talent Agency, for an upcoming episode of ‘The Town,’ and I thought I’d give WIH readers a little preview of the chat… Matt: What does the agency landscape look like in five years? Do we see more consolidation? Does CAA buy you? Does a fourth or fifth big agency emerge? Or are CAA, WME, and UTA now an entrenched oligopoly? David: One, we’re not for sale.

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You above anyone else should know everything’s for sale. I think five years from now, you will still be looking at CAA and WME and UTA, and there will be the opportunity for some smaller agencies to grow. But it takes tremendous capital and time. The last big agency that started was 30 years ago. We might see some consolidation amongst [the smaller] agencies. Yeah, I think some are going to fall away. These smaller agencies lived on pilot season. And if this current contraction holds, they will buy each other or merge or go away. We’re already seeing it. Verve is out there right now [looking for a deal]. Some of the others are, too. And Gersh took in private equity. Maybe there’ll be A.I. agents. I wonder if it will take longer for your A.I. agent to call you back than your real agent?

$438.7 million Disney’s additional payment, on top of $8.6 billion it paid in 2023, to take full control of Hulu, according to an arbitrator—significantly less than the $5 billion that Comcast wanted. [Bloomberg] About 50 percent Nintendo’s projected share of the gaming console market by 2027, thanks to the release of the Switch 2, up from 42 percent in 2024. [Ampere Analysis] 500 million hours Total combined watch time of Prime Video’s Citadel spinoffs (Diana and Honey Bunny) in the first 12 weeks—less than a quarter of the 1.9 billion generated by the pricey original. [Luminate] 5.1 million Live+Same Day viewers on CBS and Paramount+ for Sunday’s Tony Awards, up 44 percent from last year and the biggest since 2019—likely thanks to host Cynthia Erivo of Wicked or the Hamilton reunion. [CBS/Nielsen] Now here’s my breakdown of the biggest news of a big news day…

Given what we know now, and the stunning destruction of value and livelihoods at Warner Bros. Discovery over the past three years, it’s especially tragic to think back to those first few months after David Zaslav became C.E.O. of the new company. The grandstanding about the “unique” power of smashing together prestige (HBO) with populist (Discovery). The dubious boasts about controlling “40 percent of the world’s greatest I.P.,” via Warner Bros. This 2022 banger, uttered with a straight face: “Together, this combination makes us the best media company in the world.” You think Zaslav actually believed those lines back then? The company’s $55 billion in debt and the revenue trajectory in linear television were already pretty clear at the time. I called the entire enterprise a “tightrope walk” from the beginning, and its projected EBITDA sank almost as soon as it started operating—due, of course, to that evaporating television revenue. And yet, instead of accepting his fate at Discovery Communications, which would have shriveled in size and value without corporate intervention (just as has befallen its peer TV businesses AMC Networks and A+E Networks), Zaslav and investor John Malone created what my colleague Bill Cohan has called a publicly traded leveraged buyout—a last-ditch Hail Mary by a TV company to use HBO and a legacy studio to slingshot itself into a digital future. All of which could be spun publicly as a “merger” that created a new studio, just as cool and retro as the old ones but with scale and a purpose. And, of course, a reason to keep paying Zaslav his extraordinary compensation packages, $52 million just last year. Hence the studio mogul cosplay… the Bryan Lourd– and Ari Emanuel–enabled “listening tour” that doubled as a chance to finally have his ring kissed not by Guy Fieri or Chip and Joanna, but by J.J. Abrams and Dwayne Johnson and other stars who actually matter. Hence the Vanity Fair spread. Hence wearing that cream-colored suit to the Cannes party that Zaz’s own people told him not to throw during the strike. Hence that end table against the wall and near the bar at the Polo Lounge, where Zaz could preen and gesticulate in full view of everyone who arrived—where he could regale Diane Keaton or Barry Levinson, or whoever he thought was an impressive date, with stories about how he retrieved Jack Warner’s desk out of storage and now sits behind it every day. How he was renovating Bob Evans’s house, just because. He’d ask major players like Spielberg or Charlize what they thought he should do with Warner Bros., not because he intended to listen to them but because he wanted them to know he had that kind of power now. Then there was Malone, the 84-year-old enabler, the so-called Cable Cowboy in an era when both cable and cowboys have become artifacts. The longtime Discovery investor definitely knew the tightrope he and Zaz were walking. He engineered the Warner Discovery merger in an attempt to salvage his investment. And when the WBD deal closed, Malone was quick to position himself as a savior after AT&T’s disastrous foray into Hollywood. “I think that the technology of connectivity and digital technologies are one focus, and creating content that people get addicted to is another focus,” Malone told the Journal. “And you seldom would find both of those in the same management team.” Yet Zaslav, Malone’s guy, was kinda neither of those, not a connectivity/distribution expert nor a producer of high-quality content. And by giving him some of the most powerful entertainment factories and a streaming distributor with global aspirations, Malone expected Zaslav to be both.

At least he was expected to be both… until today. The announcement this morning that Warner Discovery will split into two businesses is basically an admission that Zaslav has failed. The original thesis was flawed; the streamer grew to 122 million subscribers, but by its own admission those customers didn’t find much value in 1,000-lb Sisters and My Feet Are Killing Me. The rebrand from HBO Max to Max struggled to widen the tent and squandered the best brand in television. The math on the declining linear business never worked, despite the best efforts of C.F.O. Gunnar Wiedenfels to cancel movies and fire thousands of employees and slash the company’s debt by an astonishing $20 billion. It wasn’t enough. Investors have known that for a while now. And at this point, Zaslav has definitely known it, too. He’s been setting the table for this split for months, first by cleaving the company into siloed business units, then with the pullback from Max’s global Netflix-killing aspirations. It had to be done. The company has lost nearly two thirds of its value since its launch. S&P just downgraded its debt to junk status. Comcast is spinning off its cable networks, giving WBD a template, though that company has the cushion of diversified revenue through broadband sales and theme parks. Wall Street thinks of Warner Discovery not as the holder of 40 percent of the world’s premium I.P. but as a debt-laden television company, which it is. That had to change.

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So now it will be Streaming & Studios (working title), the “growth” side of the company, with the soon-to-be-renamed HBO Max and the Warners studio and the U.S. sports rights, and Zaslav in charge. The guy whose expertise was supposedly the “populist” content and managing a linear portfolio will soon preside over only the elements of the WBD enterprise that he was learning about on the fly—namely, the good stuff, and the direct-to-consumer business, the movies and shows that matter. And when this split closes mid-2026, if you have worked at HBO or Warners for just seven years, your paychecks will have come from four separate companies: Time Warner, WarnerMedia (AT&T), Warner Bros. Discovery, and whatever Streaming & Studios is called (Just Warners? WarnerMax? Looney Tunes?). “Splitting them from the declining (but still cash flow generating) linear assets may be the best path for WBD to unlock the greatest value of its portfolio,” MoffettNathanson wrote in a note to clients today. True, the company still controls amazing assets, but today is an acknowledgment that the sum of the parts never gelled. And on the other side, Gunnar’s reward for years of disciplined grim reaping is now his own company to run as C.E.O. of Global Networks, a publicly traded CrapCo, where he will almost certainly cut more costs and ride the decline of the cable bundle. CNN, for one, should probably expect a particularly brutal bloodletting as Gunnar scrutinizes its global newsgathering budgets and asks, What is absolutely necessary to maintain our carriage fees and signal to the Street that we care about digital? (Answer: not nearly as much as CNN currently spends.) Presumably, some deal will be worked out for the remaining sports that the Turner networks air but the S&S company will control. Remember, the big question on the spinoff was how Zaslav would rid himself of the TV networks while retaining at least some of the cash they still generate. That solve is a financial machination that offloads nearly all of the company’s $34 billion in debt on GunnarCo with a $17.5 billion bridge loan from J.P. Morgan to keep bondholders from jumping off the WB water tower. Additionally, Global Networks will keep a 20 percent equity stake in the Zaz side, providing that funding to hopefully fuel growth. Will this work? Investors aren’t excited, or at least they punished the share price today, despite an initial pop. Increasingly, this new strategy looks like a placeholder until Zaz and Gunnar can find buyers for their pared-down entities, if those buyers exist. Tellingly, Wiedenfels is not a media business operator, as is Mark Lazarus, the veteran NBCUniversal sports and TV executive who is running Versant for Comcast. So the goal seems to be to prune and milk the networks, and then combine them with Versant or find another financial buyer. Same with some endemic buyer on the S&S side. A depressing outcome, for sure, though not quite as bad as what AT&T did in Hollywood. Randall Stephenson and John Stankey lost their shirts buying DirecTV at the height of the multichannel bundle, then they took WarnerMedia, valued at $109 billion (with debt) in 2018, and turned it into a $43 billion “merger” with Discovery just three years later. Amazingly, Stankey kept his job. As will Zaslav, despite that nonbinding shareholder vote against his pay. It’s wild to think that Warner Discovery launched with the tagline “The Stuff That Dreams Are Made Of,” from The Maltese Falcon. But at this point, the only one whose life has been the stuff of dreams is Zaslav, extracting tens of millions of dollars, sitting courtside at MSG with Larry David and at the French Open with Dustin Hoffman, or strong-arming Tom Cruise into hanging out at his soggy Olympics party in Paris. Other than Zaz and the investors who shorted WBD at launch, nobody has made any money on this publicly traded leveraged buyout. I suppose it’s fitting that the ultimate downfall of Warner Discovery, among other things, was the belief that the low-budget, lean-back reality fare of the cable era could help turn a TV company into Netflix. The entire foundation of Zaslav’s career ascent ended up coming back to bite him in the ass.

My friend Adam Aron found a way to squander the recent goodwill from the box office hot streak: More commercials before AMC movies! [Bloomberg] Bill Cohan walks through what happens to Shari Redstone if the Paramount-Skydance deal falls through. [Puck] If Meta wants Hollywood content for its wearable tech, why not just sell a few of Mark Zuckerberg’s gold chains and buy a Hollywood studio? [WSJ] Mini-dramas are so hot right now, just don’t use the Q-word (Quibi). [Business Insider] Sadly, David Zaslav did not make Scott Feinberg’s list of possible Thalberg honorees. [THR] Writer Jennifer Wilson learned how to become an intimacy coordinator (yes, she can now administer a penis pouch). [New Yorker]

Shari Redstone and the Paramount/Trump standoff dominated my messages this week. Some examples… “I think a strong case can be made that Trump has all the leverage:

—An executive “The media drumbeat misses the key point: Internal texts, emails, and Slacks from pretrial discovery would be utterly damning to the news organizations. Remember the internal text shitstorm in the Fox News/Dominion lawsuit?” —A professor “Lol David Ellison at UFC with Trump [on Saturday night]. Adorable he thinks Trump values their relationship over the money he can keep getting out of companies that have business before the government.” —An agent

Nice to see I’m not alone in my excitement over Paramount’s The Naked Gun reboot, according to The Quorum’s early film tracking chart…

Have a great week, Matt Got a question, comment, complaint, or a single person who cares who Brian Grazer voted for? Email me at Matt@puck.news or call/text me at 310-804-3198.

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