Like Clockwork, Paramount/CBS Cuts 18% Of Workforce After Skydance Merger
from the merge-ALL-the-things! dept
Last month we noted how the brunchlords in charge of Paramount (CBS) decided to eliminate decades of MTV News journalism and Comedy Central history as part of their ongoing and utterly mindless “cost saving” efforts. It was just the latest casualties in an ever-consolidating and very broken U.S. media business routinely run by some of the least competent people imaginable.
We’ve noted how with streaming subscriber growth slowing, quarterly returns have stagnated. So media giants (and the incompetent brunchlords who usually fail upward into positions of unearned power within them) have turned their attention to all the usual tricks: layoffs, pointless megamergers, price hikes, and more and more weird and costly consumer restrictions.
That of course includes Paramount, recently announced a major merger with Redbird/Skydance. As usual, executives promised that the resulting union would be transformative for the company:
“It’s a new Paramount; it’s not just a catchphrase,” said RedBird’s Jeff Shell, former CEO of NBCUniversal, on a call with investors Monday. “We think it’s going to be a new day for these combined assets.”
In reality, this kind of consolidation serves no real world function outside of temporarily goosing stock valuations, nabbing a few tax cuts, and flimsily justifying outsized compensation for major media executives. The AT&T, Time Warner, and Discovery mergers did a particularly stellar job demonstrating the chaotic pointlessness of this “we’re completely out of ideas so let’s consolidate” mindset.
Much of the headaches are due to the decline of the traditional TV business, which wouldn’t have been quite so painful if executives had adapted to the streaming transition earlier and more smoothly (remember they all wasted the better part of a decade insisting that cord cutting was a fad that would stop once Millennials started procreating).
Wall Street’s insatiable need for endlessly improved quarterly returns at impossible scale means these companies can’t just make a quality, affordable product that people like. So instead their only solution is to grow larger and larger — while making more and more cuts that sacrifice employees, product quality, customer service, and consumer satisfaction.
The folks that make all the terrible decisions that wind up running these companies into the ground (like Warner Bros Discovery CEO David Zaslav) almost never see real accountability. Instead all the costs of their incompetence are borne by either consumers in the form of higher prices (to pay off merger debt) and lower quality product, or by lower level employees in the form of reduced pay or benefits, and layoffs.
It took less than a week for Paramount’s three current and still-employed CEOs (CBS CEO George Cheeks, Paramount Pictures/Nickelodeon CEO Brian Robbins, and Showtime/MTV CEO Chris McCarthy) to announce they would be axing about eighteen percent of the company’s workforce. For, you know, synergies:
“The entertainment conglomerate behind Paramount Pictures is to cut about 2,000 jobs in a bid to reduce costs ahead of a merger with the independent film studio Skydance.”
Again, the promise here is that this results in a better, leaner company, but when it comes to media deals like this, that’s rarely the case. There’s hardly a single major media merger in the last twenty years that genuinely improved the fortunes of employees or consumers.
It’s a pointless doom loop that’s infected both entertainment media and traditional journalism. By the time any sort of check comes due for executive incompetence, they’ve either retired on the back of outsized compensation, or are off to another company to repeat the entire process all over again, having been financially disincentivized from learning absolutely anything from the experience.
Filed Under: consolidation, enshittification, journalism, layoffs, m&a, media, mergers, streaming, video
Comments on “Like Clockwork, Paramount/CBS Cuts 18% Of Workforce After Skydance Merger”
You could just say that capitalism is the problem
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It’s bad capitalism the ways we’re allowed to get away with.
The main problems with any economic system ever are the problems of doing it the worst way possible.
Looks like the Brunch Lord Business Model has outlived its usefulness.
Laying off people is often good news for shareholders, it means that the company has found redundancies and will be able to concentrate on the most profitable objectives (the ones that actually make money).
It pretty like spring cleaning when you throw everything you don’t actually need.
In a capitalist world where salaries are expensive but human are disposable, the only goal for large companies is to throw everything by the window until they find the few bank notes they’ve hidden, then use them to buy everything they’ve thrown away.
Then shareholders will clap their hands in rhythm praising some much effectiveness, and at the end of the day, they could make sweet dreams about exotic countries where it pours heavy money rain twice a day.
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“Laying off people is often good news for shareholders, it means that the company has found redundancies and will be able to concentrate on the most profitable objectives (the ones that actually make money).”
It maybe good for shareholder’s immediate future, however the future they tend to ignore is going to bite them in the ass. This has happened in the past, for example when Japan beat the shit outta Detroit in the automobile industry. Detroit was busy with their planned obsolescence resulting in piss poor quality while Japan was busy producing automobiles that would last three or four times as long as a Detroit pos, and the market responded.
“It pretty like spring cleaning when you throw everything you don’t actually need.”
It’s sort of humorous when working at a business that has just gone through such a “House Cleaning”. In subsequent staff meetings there will be questions about things that are missing schedule and middle management is wondering who is supposed to be doing that work. Then they are informed that those people were let go and there is no one at the business to do that work. Red faces and shaking heads – hahahahaha.
“Then shareholders will clap their hands in rhythm praising some much effectiveness”
Yup, until the stock crashes.
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It’s funny how bosses piss and bitch and whine and moan that nobody wants to work, when they consistently treat the people driving the bulk of actual work done as if they’re the dregs of society who should be thankful for having a supervisor that spits in their general direction.
The truth is that actual work is not something that’s valued. It’s treated as necessary, but also something that only the lowest of the low should need to do, because the really successful people are the ones who own assets, not the ones who have to work for them. Subsequently, policies and decisions favor the asset owners, not the actual workers. As the saying goes, “Just because you’re needed doesn’t mean you’re important.” Who cares about actual work getting done so long as the shareholders see a line go up indefinitely?
These mergers cost billions in debt they achieve nothing .Company’s laden with debt lay off 1000s of workers and also reduce investment .it also reduces competition in the media .if this continues there may be 4 or 5 big American company’s who own most of the film,tv content .of course the top level executives are happy as they get big salary’s
and bonus payments .
This is not good news for consumers as it means increasing subscription fees .
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“This is not good news for consumers as it means increasing subscription fees .”
.. and eventually it becomes not good news for investors either due to the business is losing customers because no one can afford the product anymore.
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…and the top mgmt team will still make 7-8 figure bonuses and isn’t buying some rando jackass, that would shit on you for a nickel, a 4th yacht really what life is all about?
employees are disposable peons, not assets
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“employees are disposable peons, not assets”
yup, until there is a pandemic which removes a significant number of these so called peons, then we get Essential Employees who are not paid any more, just expected to work during the shutdown risking getting covid … back when it was killing many people.
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We used to send armed men to force people back to work if a strike or something else happened. Now we have armed people to escort you out of the building when the most useless clowns decide others are “redundant”.
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ORLY?
I wonder how many staff positions they could save by laying off just one CEO?
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Zero to negative. The new CEO still has to be paid egregious bonuses and they’ll still cut the throats of the emps, because emps get paid in THEIR money, while the CEO gets paid in HIS money.
GL!
Re: Re: That darn Elmo...
Question for TSLA stockholders: If you had only paid Elmo $26B, would the lousy 2nd qtr. numbers have been any different?
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I think it depends on the company but for publicly traded companies this is a required disclosure and the AFL-CIO creates a report which has an average of 268:1 for 2023 meaning each CEO can theoretically represent the wages of 268 workers earning the median company wage.
they're still figuring out whether Paramount has a business
Netflix changed the entertainment business. They offered people a better deal vs expensive, impossible-to-cancel cable. Streaming is (still) much cheaper and easy to cancel so you can hammer down your costs by simply churning.
This yanks a lot of money out of the once-fat entertainment ecosystem and there isn’t room for all the incumbent companies to survive. Especially since opportunistic tech companies have jumped in and stole plenty of former customers.
It’s far from clear Paramount (or Warners) can adjust in time to find a niche to live in. Layoffs and mergers are just symptoms of that struggle. Even with the Ellison billions bo burn through, odds are that this effort will fail unless they have some fundamentally new idea, not just here’s a streaming service and there’s some theatrical movies.
Re: The last lifeboat was just lowered...
Streamers, working with a different set of economics, now throwing billion$ at sportsball, like the NBA ditching TNT for Amazon.
Karl Bode not describing execs as brunchlords for once challenge (impossible)
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If you want to start listing out CEOs that aren’t massive piles of shit, we’re game.
It’s only going to cost you 20-30s, before you realize the 2-3 that you wrote down are about it.
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It’s perfectly descriptive. This isn’t a novel where you need to say the same thing 20 different ways. (in languages where that’s even a thing.)
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On the other hand, give people enough time and I think they can come up with more than twenty disparaging descriptors to refer to executives.
Unless you find a DVD from a very small print run, it is impossible to watch Comedy Central’s Indecision 2000, the run of The Daily Show that won them a Peabody award. It’s simply too old and never got added to the streaming catalog.
Think of the brunchlords!
It is difficult to get a man to understand something, when his salary depends upon his not understanding it!
“…they’ve either retired on the back of outsized compensation, or are off to another company to repeat the entire process all over again, having been financially disincentivized from learning absolutely anything from the experience.”
Bullshit. They have indeed learned all they need to learn, which is how to get rich fast through enshitification.
As long as you guys keep stating this is just the work of folks that “don’t know any better” because they don’t see the problems that arise, you are encouraging the continuity of the scam.
This is 100% a fully legalized get rich quick scam that leaves 100s, and soon, thousands of employees unemployed.
Consider: normal corporate thinking – becomes the biggest of the bunch. This necessitates a product or service that will be “best of its kind” for a long time.
Reality: Most products/services today get improved upon and replaced by better products/services very quickly.
This means there is little chance of becoming the biggest. So, second best is to take your P/S and run with it till you have a large customer base, through good deals, then switch to the enshitifiaction model and cash in. Take the money and run.
What they learned was how to turn laws to their favor by simply paying lawmakers to reinterpret the laws.
They learned all they needed to learn.
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👍👍
“We’re laying people off to eliminate redundancy,” says company with three CEOs.