Paramount Global, a prominent media conglomerate, has announced significant changes as it prepares to merge with Skydance Media. The company revealed plans to lay off 15% of its US staff, affecting around 2,000 employees, and write down $6 billion in the value of its cable television networks. These measures are part of Paramount's efforts to reduce costs by $500 million annually ahead of the merger with SkyDance.
The layoffs will target 'redundant functions' in marketing and communications, as well as reduce headcount in finance, legal, technology, and other support areas, according to Paramount's co-chief executive Chris McCarthy. The decision to write down the TV business value is attributed to recent trends in the linear affiliate marketplace and the estimated total company market value indicated by the Skydance transactions.
This announcement reflects the ongoing changes in the traditional television industry, driven by the shift in consumer preferences towards streaming services over cable bundles. Warner Bros. Discovery, another major player in the media landscape, recently reported a $9.1 billion write-down on its television business, acknowledging the evolving market conditions.
These industry shifts have also impacted digital news outlets and print publications. Axios, a news outlet, announced layoffs affecting 10% of its staff, citing changes in the media business landscape. Similarly, Broadcasting+Cable, a long-standing TV trade magazine, announced its closure due to the rapid transformation of the industry.
Despite challenges in the television sector, there have been positive developments for streaming services. Paramount's streaming platform, Paramount+, reported a $26 million profit after a significant loss last year and anticipates subscriber growth in the coming months. Warner Bros. Discovery noted growth in its HBO Max and Discovery+ services, adding 3.6 million new subscribers in the latest quarter, reaching a total of 103.3 million global subscribers.
