Thirteen months after it was originally agreed upon and announced, Skydance’s $8 billion purchase of beleaguered Hollywood studio Paramount Global has finally closed.
"Today marks Day One of a new Paramount. I am thrilled and honored to write to you as Chairman and CEO, as — together with our board, our new executive leadership team, and our colleagues around the world — we embark on the exciting next chapter of this legendary company,” remarked Skydance chief David Ellison, in a publicly accessible note to Paramount staff.
With an arduous regulatory approval process completed — which included major capitulations by CBS News to U.S. President Donald Trump — Ellison and his Skydance team will face several austere challenges: most specifically, a mountain of debt, $15.52 billion worth, compounded by a fast-declining linear TV business that just declined 6% YoY in Q2.
The 42-year-old Ellison, son of billionaire Oracle founder Larry Ellison and backed by the deep pockets of private equity firm RedBird Capital, has announced his intentions to find $2 billion in “real efficiencies.”
Right off the bat, the Paramount employee body is bracing for layoffs. Seemingly sensitive to the morale issue, Ellison delivered his address Thursday not in Hollywood but in the New York offices of CBS News, where he also reportedly took a tour of 60 Minutes headquarters.
“We recognize it’s been a challenging period, and we’re deeply grateful for your resilience, professionalism, and unwavering commitment to the news business,” Ellison said, specifically addressing the news division. “We take immense pride in CBS News’ legacy of impactful journalism and look forward to continuing to foster a newsroom culture where journalists are empowered, trusted and equipped to do their best work.”
Focused on the future, Ellison’s address didn’t once mention the woman from whom he bought the venerable studio, Shari Redstone, whose family will walk away with $1.75 billion for surrendering their controlling share of the company. It was her late father, movie-theater baron Sumner Redstone, who purchased the erstwhile Viacom in the 1980s and steadily built into the media-conglomerate giant we know as Paramount Global today.
The new game plan?
In his Thursday address, Ellison discussed plans to “reengineer how our company operates, produces its creative content, and goes to market,” noting that Paramount will be “reorganized …into three business units: Studios, Direct-to-Consumer, and TV Media.”
Calling this alignment “new” may strike some as a bit confusing — as you can see from Paramount’s fairly flatlined results in the second quarter, it’s already pretty much organized this way.
For his part, however, Ellison pledges to “drive efficiency through improved decision-making,” while “supercharging our creative engine” and “scaling our streaming services.”
To achieve that goal, he hired as his new studio president Jeff Shell, who abruptly exited a peer-level role at NBCUniversal two years ago amid allegations of an improper romantic relationship with a subordinate.
Chris McCarthy and Brian Robbins, two-thirds of the interim “office of the CEO” trio who were put in place to manage Paramount amid the Skydance transition, will depart the studio. The third member of that team, George Cheeks, will stick around to manage production.
Meanwhile, former Netflix original content chief Cindy Holland, who was pushed out the streaming giant in 2020 after 18 years, will take over the DTC streaming operation from Tom Ryan, the Pluto TV founder who joined Paramount when the studio bought his AVOD startup back in March of 2019.
Ryan had steadily built Paramount+ into to a profitable operation with nearly 80 million subscribers. But as customary in these kinds of wholesale regime changes, he’s leaving just the same.
In typically magnanimous style, Ryan summed up his 12-year run at Pluto and Paramount in a note published on social media on Monday.
Ryan’s next venture? Yup, an AI startup.