Paramount must keep Pluto TV free for five years under Warner Bros. merger settlement
Pluto TV will stay free for five more years if Paramount's takeover of Warner Bros. Discovery goes ahead.
That condition sits at the centre of a settlement between Paramount and state attorneys general over the proposed $110 billion merger, detailed in reports published on 22 September 2026. The deal requires Paramount to keep Pluto TV, or another free, ad-supported streaming service — meaning viewers pay nothing and watch adverts instead — at its current service and quality for the next five years, according to Deadline.
The settlement closes a legal fight that began when California Attorney General Rob Bonta filed a suit to block the merger on 13 July, as recorded by the California Attorney General's Office. Attorneys general in California, Massachusetts and Washington each announced settlements on 21 September. The national payment totals $25 million over five years, according to Variety.
Cable television is the other big piece. Paramount and Warner Bros. must keep negotiating their basic cable packages separately and at arm's length. That phrase means the two channel portfolios cannot be bundled together to press pay-TV providers for higher fees.
Fail that test, and Paramount must sell channels. The penalty list names BET and its sub-channels, VH1 and Comedy Central. MTV and Nickelodeon are excluded from the potential sell-off.
The separate-negotiations rule has limits. It does not cover other parts of the combined organisation, such as premium cable channels, streaming services or broadcast television.
Newsrooms get their own safeguard. The settlement provides for a news editorial independence board to support continued editorial independence at CBS News and CNN. No further detail on its powers was included in the published summaries.
Film production is also covered. The merged company faces a court order to lift film output, including a minimum extra commitment of $1.5 billion for domestic film, according to the Washington Attorney General's Office. That is money to be spent, not a target number of titles.
Paramount has long disputed the states' case. The company said the challenge "reflects a fundamentally flawed application of the antitrust laws," in a statement on its press site. It launched an all-cash tender offer for Warner Bros. Discovery at $30.00 per share in December 2025.
The road here was bumpy. California broke off settlement talks with Paramount in August 2026, Reuters reported at the time. The clock is still running. Paramount owes Warner Bros. shareholders a $7 million-per-day ticking fee for each day after 30 September 2026 until the deal closes, according to The Fresno Bee.
What makes this stand out is how directly it touches viewers. Free streaming stays free. Familiar cable brands face a possible sale. News divisions get a formal independence structure. For crews and writers, the $1.5 billion film pledge matters most. It is work that either gets ordered or does not.
