Fly United - part the second

The masters of the universe have been doing it for decades, and have not learned a thing. Or may be they have. May be they have learned that M&A really only exists to make the few sitting on the top of the pinhead rich, while decimating all others. Kind of like a mob or dictatorship. The bankers who finance these boondoggles never seem to catch it in the neck.

So, today we find that HBO Max is the latest victim.

Roughly 70 HBO Max staff members were laid off on Monday, job cuts that are part of a wider reorganization at the cable channel's parent company, Warner Bros. Discovery

So, as usual, the 'new' company lays waste to its workers. As if there's enough wasted labor to make up for the debt incurred. Just food for the gods.

Warner Bros. Discovery, which began as HBO's parent company in April when AT&T spun off WarnerMedia and merged it with Discovery Inc., has a crushing debt load of more than $50 billion.
[my emphasis]

Why, oh why, do these masters of the universe always, always pay outlandish, unsupportable, amounts of moolah? The answer is always the same, almost always never admitted: get big enough, and you can control the market and set prices divorced from cost. All teeVee/streaming is heading back to the glorious 50s, with a never ending ship of clones of Ted Mack (look him up). Again, the bankers and those sitting on the pinhead get rich. They get their cuts up-front, leaving the people who do the actual work to get it in the neck. This will not turn out well for those that remain. As any mob, the few sitting on the pinhead will suck out moolah up-front until the enterprise says "hello" chapter 11 or chapter 7. Just as night follows day.

Here's a rose-colored glasses of the first merger

The still-to-be-named company, which will be helmed by current Discovery Inc. CEO David Zaslav, says it wants to further invest in content—about $20 billion worth a year. That could cause the price for whatever streaming service it rolls out to rise—but will it matter if consumers feel like they don't have to pay for several different streaming services, and instead can access a cornucopia of content from just one provider?

Where's the moolah come from? The usual, debt from others

As reported by Deadline, Discovery is currently raising the $30 billion through a sale of debt using what are called senior unsecured notes. These are ways for businesses to raise money for purchases such as this. They are not backed by collateral and, as a result, carry a higher interest rate for the purchaser. They are riskier, but the interest rate helps to make them attractive.

As noted (either here or one of the many forums I inhabit) previously: in the good old days there were 3 teeVee networks (and may be, for a time, 1/2 if you count DuMont), which made audience size easily measured and controlled. Before I croak, I'll bet a dime to a donut that streaming, and surely cable/sat, will be down to a few, may be even just 3, providers.