Paramount settlement safeguards Pluto TV and may require divestiture of BET, VH1 and Comedy Central

A settlement of the antitrust case brought by 12 state attorneys general over the proposed Paramount-Warner Bros. Discovery merger includes a clause that requires Paramount to retain Pluto TV or another free, ad-supported streaming service for the next five years. The agreement also specifies that if Paramount fails to keep carriage negotiations for its basic cable networks separate from Warner Bros. Discovery’s, it may have to divest a list of linear channels, including BET and its sub-channels, VH1, Comedy Central, Smithsonian, Destination America and Science.

California Attorney General Rob Bonta said the settlement “requires Paramount and Warner Brothers to continue negotiating their cable packages separately,” a condition intended to preserve competition between the two entities after a merger. He added that a monitor and a state committee will oversee compliance, and that material violations could trigger a six-month cure period before forced divestiture.

The deal does not address Paramount’s premium channels, streaming services or its television studios, leaving those areas unregulated by the settlement. Paramount executives have highlighted Pluto TV as a strategic component of their advertising platform, noting recent investments and expected growth later in the year.

While MTV and Nickelodeon are excluded from the potential divestiture list, the inclusion of BET, VH1 and Comedy Central reflects the attorneys general’s focus on protecting competition in the basic cable segment.