David Ellison sets out vision for future as Paramount-Skydance merger finally closes
Paramount chairman and CEO David Ellison declared the “time of uncertainty is now behind us” as his long-gestating deal to merge Skydance and Paramount Global concluded on Thursday, adding that he sees a path to “meaningfully exceed” the previously announced US$2bn in cost cutting measures.
As such, the coming months will be “defined by a series of focused efforts to re-engineer how our company operates, produces its creative content and goes to market,” said Ellison in a statement announcing the launch of the company, which is officially called Paramount, a Skydance Corporation.
With the US$8bn deal, which is backed by private equity firm RedBird Capital Partners and US software giant Oracle, the merged entity will be reorganised into three business units: Studios, Direct-to-Consumer and TV Media.
Skydance revealed last week that it would re-establish the Paramount Television Studios brand, initially shuttered last year, with Skydance Television being absorbed into it.
Ellison said that combining the TV studio operations will “enable comprehensive green-light and licensing decisions, increase production output, enhance our ability to attract top creative talent, and improve transparency for our external stakeholders.”
The challenges faced by New Paramount’s TV media division, which houses broadcaster CBS as well as fast-shrinking linear assets like Comedy Central, MTV, VH1 and Nickelodeon, are evident for all to see, with Ellison acknowledging that the challenge is to “reinvent our portfolio of brands for a non-linear world.”
“We plan to invest appropriately based on the future business opportunity, thereby maximising cash flow so we can reinvest in our growth businesses,” he said. Former Paramount Global co-CEO George Cheeks will lead the TV Media division as chair.
On the streaming side, Skydance has said it plans to quickly expand the direct-to-consumer business globally, building on the 77.7 million subscribers currently held by Paramount+, as well as its AVoD platform Pluto TV. On the content side, the Direct-to-Consumer division is being led by former Netflix and Sister exec Cindy Holland.
Part of the streaming plan, Ellison said, is to transition Paramount to a single technology platform, which will reduce costs while “driving substantial efficiency and performance gains and enabling leaders across the company to make faster and better decisions.” This is one of the ways in which the new leadership team believes it can exceed the US$2bn cost-reduction target.
And although it plans to make major cuts, Ellison said Paramount was committed to increasing its investment in “premium, exclusive content,” with sports programming highlighted as a key driver of audience engagement and lowering churn.
Ellison also sought to pledge his commitment to the news business after the credibility of Paramount’s CBS News was called into question when it agreed a US$16m settlement with US president Donald Trump over what most experts believed was a meritless lawsuit. Former Paramount Global owner Shari Redstone came under fire for the handling of the situation, with many characterising the settlement as a “bribe” to ensure the Paramount-Skydance deal received regulatory approval.
“We recognise it’s been a challenging period and we’re deeply grateful for your resilience, professionalism and unwavering commitment to the news business,” said Ellison. “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.”
With Ellison and his team now officially taking the reins, attention turns to where the cuts will come, how deep they will go and which assets they look to offload and potentially acquire.
Skydance’s incoming leadership team has frequently spoken of the opportunity it sees in the streaming business, but much less has been said of its linear assets, which span both the US cable portfolio as well as international networks including UK broadcaster 5, Australia’s Network 10, Chilevisión and Argentina’s Telefe.
