Thirty films a year, a monitor for CNN

An antitrust settlement is supposed to fix a competition problem. The terms reported to be under discussion between Paramount and the states suing it would fix rather more than that.

Paramount Skydance is in advanced talks with California's attorney general, Rob Bonta, over the twelve-state suit blocking its takeover of Warner Bros. Discovery, Variety reported. A judge has ordered the parties to a two-day settlement conference in San Francisco on 14 and 15 October.

The terms said to be in play are specific. An editorial board to monitor CNN. A commitment to release thirty films a year in cinemas. An undertaking not to negotiate carriage for all the company's channels as a single bundle. The sale of some cable networks. And a promise to keep the company in California.

Sort those into two piles. The carriage undertaking and the channel divestitures are ordinary antitrust remedies: they address bundling power and concentration, which is what the case was about. The rest is something else.

Thirty theatrical releases a year is an industrial commitment to a distribution channel and to the people employed by it. Staying in California is a jobs guarantee to the state whose attorney general is negotiating. Neither has anything to do with whether the merged company can raise prices.

The CNN editorial board is the most consequential and the least examinable. Whatever its intent, it creates a standing body with some claim over a news organisation's judgement, negotiated by a state law officer as the price of a merger approval, with no statute defining its powers.

That is why the political objections are coming from the same side as the enforcement. Senator Elizabeth Warren said it would be "a massive mistake to cave on the Paramount merger", and the actor Mark Ruffalo publicly urged Bonta not to settle.

The case for settling is simply that the alternative is uncertain. Litigating to judgment risks losing outright, and Paramount's defence that the plaintiffs invented the market they are protecting is not frivolous. A settlement converts a possible loss into a set of enforceable promises.

The cost is that it converts merger review into bargaining over concessions unrelated to competition. Every future acquirer now knows that a state's objection can be answered with production quotas and headquarters commitments, which is a transferable lesson.

October's conference is the date to watch. If it produces a deal, a $110bn merger will have been resolved on terms that no court tested and no legislature wrote, and the precedent will outlast every provision in it.