The Federal Communications Commission has been reviewing M&A deals in the media space for decades and a key concern for the agency is whether such combinations are in the “public interest.”
Skydance’s $8 billion purchase of Paramount and its CBS News subsidiary might just pass the FCC’s public interest litmus test — a loosely defined concept that involves promoting fairness in broadcasting and how companies are managed — if and only if the guys in charge of the new company ditch any allegiance to Diversity, Equity and Inclusion policies, On the Money has learned.
In fact, as long as Trump appointee Brendan Carr remains at the helm of the FCC, getting rid of so-called DEI will be a prerequisite for any media deal that needs FCC approval, people with knowledge of Carr’s thinking add.
The good news for the Skydance-Paramount combo is that the new management will be led by David Ellison. The Skydance boss – and son of Trump pal Larry Ellison of Oracle fame – and his partners at Redbird Capital are no fans of DEI, I am told. They are likely to dump the racial- and gender-based hiring policies without much of a fuss, my sources say.
The bad news for the rest of the media industry: The super woke companies will have to decide to give up on their lefty political biases if they want to survive with Team Trump in charge.
A Skydance spokeswoman declined to comment on the matter as did press reps for Comcast and Disney. An FCC rep didn’t return a call for comment.
Carr, for the unacquainted, is a longtime telecom attorney (he was an FCC commissioner before Trump appointed him chair) and conservative activist. He also believes he’s on firm ground demanding that all companies seeking his “public interest” merger approval start by nixing DEI. The acronym is better known as racial- and gender-based quotas and it is pervasive in hiring and promoting for on-air talent, and in the broader workforce, for most media companies.
While Skydance might be willing to ditch DEI, it will be a bitter pill for the broadcast industry, one of the most woke businesses on the planet. Media and theme park giant Disney, as I point out in my book, “Go Woke Go Broke; The Inside Story of the Radicalization of Corporate America,” mandated DEI in everything from characters in its cartoons to the hiring of interns.
DEI goes beyond media, of course. It’s why a trans woman was featured in a Bud Light commercial, sipping a beer and giggling about March Madness. DEI is why retailer Target featured a month of gay pride displays that were so graphic that its Middle America customer base rebelled.
DEI is why Harvard skewed its admissions against high-achieving Asian students, and white males found it difficult to get hired and promoted at large companies, particularly after the 2020 killing of George Floyd. The incident ushered in calls for “racial justice” and soon quotas in employment by many leftist politicians and their supporters in corporate America.
But times are changing, or to be more precise they have changed. The courts have ruled that racial preferences are unconstitutional, whether it’s in college admissions or hiring. Donald Trump was elected on a platform of getting rid of DEI when the federal government has a say over issues.
Corporate mergers — which need approval from Trump-run regulatory agencies including the FCC – falls well within those issues, my sources say. Carr, I am told, believes it’s within the “public interest” to throttle deals by using the FCC power to withhold local broadcast licenses (as opposed to cable which doesn’t have the same FCC rules) if new companies don’t agree to ditch DEI.
In just a few months, Carr has opened DEI-related cases against Disney and Comcast-owned NBC. Expect more if media mergers pick up as they should given Trump’s lighter regulatory agenda.
Carr’s investigation into the Paramount-Skydance deal has been delaying the merger for months. He’s looking if the merger comports with anti-trust and public interest rules, including the Trump administration’s contention that DEI is illegal and definitely not in the public interest.
He is also investigating CBS for allegedly deceptively editing a controversial “60 Minutes” interview with Kamala Harris during the campaign, whether the news magazine edited out her famous word salad answers to make her sound more coherent, as many critics contend.
That investigation has teeth given the FCC’s authority over public airwaves like local broadcasting (as opposed to cable), which again must comport with FCC public interest guidelines that stipulate fairness in news broadcasting.
Like Skydance, Shari Redstone, the current principal owner of Paramount, is eager to ensure that Carr’s demands are met to get the deal completed and cash in on her payday of around $2 billion, On the Money has learned. She’s also looking to settle a separate $20 billion lawsuit brought by Trump against CBS News over the alleged unfair editing of the Harris interview.
CBS has stated that the lawsuit is meritless despite Redstone’s reported current plan to settle for as much as $20 million or maybe more, any day now.
