Paramount has started layoffs that will impact up to 2,000 workers, or 10% of its employees. This decision comes just a few months after its own completion of that $8 billion merger with Skydance, which finalized in August as well. Paramount’s reorganization is intended to cut costs, lean more heavily toward streaming and take advantage of assets from the merger. As maybe the most dramatic part of this effort, layoffs have been expected.
In a memo distributed to employees on Wednesday, Paramount’s new CEO, David Ellison, explained the reasoning behind the job cuts. He insisted that these cuts are “just part of the process” of reinventing the company after its merger with Skydance. The layoffs, then, are a justifiable if overdue response to that changed operational environment. The company is still responding to these changes and positioning themselves for the future they want.
Ellison’s memo, which was shared with The Associated Press, emphasized the painfulness of such resolutions. He stated, “These decisions are never made lightly, especially given their effect on our colleagues who have made meaningful contributions to the company.” This sentiment reflects the challenging environment that many media companies face as they adapt to shifting market dynamics.
As one key element of its larger corporate restructuring strategy, Paramount has substantially increased its fleet. On October 6, the company purchased the news and commentary site The Free Press. Bari Weiss, the founder of The Free Press, has been appointed as the editor-in-chief of CBS News, marking a significant shift in leadership within the organization.
Paramount’s cuts will be implemented over the next several years. Look for more cuts to be declared in the near future. This segmented strategy for layoffs indicates that the leadership is still in the process of evaluating what the company should be doing and how to respond.
The recent layoffs at Paramount are a part of a broader phenomenon in the media industry. What is happening now is companies of all sizes focusing on efficiency and integration after previous mergers and acquisitions of other businesses. That landscape is changing quickly. Whether and how Paramount makes its efforts at restructuring stick now remains to be seen in the months ahead.
