Paramount Television Studios Shutting Down Amid Industry-Wide Challenges

Paramount Television Studios (PTVS) is shutting down after 11 years as Paramount Global began the latest round of cost-cutting on Tuesday ahead of the expected merger with Skydance Media.

The news came as Paramount Global leadership began scheduled lay-offs affecting 15% of the US-based workforce, or approximately 2,000 positions, which co-CEOs George Cheeks, Chris McCarthy and Brian Robbins announced in last week‘s earnings call.

The company is looking to make $500m in cuts and laid off approximately 800 staff in February.

The closure of PTVS comes amid industry-wide challenges to linear television. Leadership will also have pored over likely synergies with David Ellison’s Skydance Media, which runs a television division and has collaborated on shows like Reacher and Tom Clancy’s Jack Ryan.

PTVS president Nicole Clemens is departing along with what is understood to be 20 to 30 staff. The move was not entirely unexpected as there was consolidation at PTVS after Cheeks brought the company under the same remit as CBS Studios.

All series and development projects will migrate to corporate sibling CBS Studios. In addition to Reacher and Tom Clancy’s Jack Ryan, PTVS has shepherded shows like 13 Reasons Why, The Alienist, and Time Bandits. Upcoming series include Cross, Before, and Murderbot.

In a memo to staff, Clemens noted the studio was not immune to a “challenging and transformative time for the entire industry”. She added, “This has been the most formative chapter in my career, and that is mainly due to the remarkable colleagues I have had the honor to lead and learn from on a daily basis.”

In a separate memo, the co-CEOs said the lay-offs would take place over three stages and were expected 90% to be complete by the end of September. Marketing and communications, finance, legal, technology and other support functions will be affected.

“The industry continues to evolve,” they wrote, “and Paramount is at an inflection point where changes must be made to strengthen our business.”

The $500m in cost-cutting is part of $2bn in savings identified by Skydance Media, Ellison’s ambitious company which is in pole position to acquire Paramount Global after agreeing to a deal with the media conglomerate’s special committee.

The transaction is expected to close in the first half of 2025 once customary closing conditions and regulatory hurdles are cleared.

A “go-shop” window allowing the special committee to consider rival bids ends on August 21. Sony Pictures and private equity firm Apollo courted Paramount Global, however Sony Group told an earnings call last week it is no longer pursuing a bid.

Background

In June, Paramount Global laid out its Strategic Plan to return to profitable growth, which includes streamlining the organization and cutting costs by $500 million on an annualized basis. As part of this plan, the company announced that it would be reducing its US-based workforce by approximately 15%, focusing on redundant functions and streamlining corporate teams.

Conclusion

The closure of PTVS marks a significant shift in the television landscape, as the industry continues to evolve and adapt to changing viewer habits. While the news may be difficult for those affected, Paramount Global remains committed to its vision for the future and is confident in its ability to emerge stronger and more resilient.

FAQs

Q: What is the reason for the closure of PTVS?
A: The closure of PTVS is part of Paramount Global’s strategic plan to return to profitable growth, which includes streamlining the organization and cutting costs by $500 million on an annualized basis.

Q: How many staff will be affected by the lay-offs?
A: Approximately 2,000 positions will be affected, which is about 15% of the US-based workforce.

Q: What will happen to the series and development projects currently in production?
A: All series and development projects will migrate to corporate sibling CBS Studios.

Q: What is the expected timeline for the completion of the lay-offs?
A: The co-CEOs expect 90% of the lay-offs to be complete by the end of September.