Skydance Embraces Tech Strategy as Paramount-Warner Merger Creates Hollywood Giant

The newly combined Skydance is betting that technology can help reshape Hollywood after the completion of its mega-merger with Warner Bros. Discovery.

The deal, which took effect Tuesday, brings Paramount and Warner’s vast entertainment assets under one company and gives CEO David Ellison a much larger platform to compete in the global streaming market.

Technology has been central to Skydance’s pitch to investors. Ellison and newly appointed co-CEO Ynon Kreiz have repeatedly highlighted plans to build a modern technology platform capable of improving streaming services, internal operations and the customer experience.

Kreiz said the company wants to build a highly capable media business using technology to improve how audiences interact with its products, make operations more efficient and reduce costs.

The company’s new leadership team also includes executives with backgrounds at major technology firms, including Google, Facebook and Scale AI. Skydance has indicated that artificial intelligence will be used across parts of the business, with Ellison describing AI as a potential “force multiplier” for filmmakers and creative teams.

The merger gives Skydance enormous scale. The combined company is expected to reach more than 200 million streaming subscribers worldwide and control major entertainment brands, television networks and news operations, including CNN and CBS News.

But that scale comes with a significant financial burden. The new company carries roughly $80 billion in debt and faces pressure to cut costs while integrating the technology systems and operations of Paramount and Warner.

Analysts expect the company to streamline overlapping platforms and eventually bring services such as Paramount+ and HBO Max closer together. Skydance executives have said the technology systems behind the company’s direct-to-consumer businesses will be unified to create a simpler experience for users.

The cost-cutting effort could also have consequences for employees. EMarketer analyst Ross Benes told CNN that promises to make the company more technology-driven could translate into layoffs, even as he acknowledged that the streaming platforms need significant technology improvements to compete more effectively with Netflix, Disney+ and Amazon Prime Video.

Skydance also faces the challenge of operating in an entertainment industry increasingly shaped by Silicon Valley. YouTube has become a major force on television screens, while TikTok and other digital platforms have changed how audiences consume short-form entertainment.

Artificial intelligence is adding another layer to that transformation. AI tools are being developed for tasks ranging from content discovery and editing to the creation of digital characters, creating new commercial opportunities while also raising concerns about jobs and the role of human creativity.

Ellison has argued that AI should support rather than replace creative professionals. The company is also bringing in executives with experience in AI and consumer technology as it looks for new ways to help audiences discover and engage with its large library of intellectual property.

The merger nevertheless faces criticism from opponents who fear that bringing so many major entertainment assets under one corporate structure could reduce competition and limit opportunities for independent creators.

For Ellison, the challenge now goes beyond building a larger Hollywood company. He must show that a technology-focused approach can improve the performance of a traditional media business while delivering better products to audiences.

The Paramount-Warner merger therefore marks more than a change in Hollywood ownership. It represents an attempt to bring Silicon Valley’s technology-driven model deeper into the entertainment industry — with billions of dollars, hundreds of millions of subscribers and the future of major streaming platforms at stake.