Paramount to Trim Trio of CEOs After Ellison Merger

David Ellison plans major changes at Paramount Global, including cuts to TV networks, increased investment in streaming, and a top management overhaul, sources say.

Ellison, set to become CEO of Paramount after its merger with Skydance Media next year, is considering merging all of Paramount's TV networks, including CBS and MTV, into a single unit. These networks are currently managed by co-CEOs Chris McCarthy and George Cheeks. While Cheeks is expected to remain, McCarthy's future is uncertain.

The third co-CEO of the company Brian Robbins, who oversees the Paramount Pictures film studio and Nickelodeon, is predicted to leave with this deal's closure, according to people who asked not to be identified discussing plans still being finalized.

Ellison agreed to the deal knowing that Paramount would need a major overhaul. The company still relies heavily on profits from cable networks like Nickelodeon, MTV, and Comedy Central, which once defined pop culture. However, these networks have lost viewers and advertisers to tech giants like Netflix and YouTube. Analysts estimate that Paramount's film studio won't be profitable in 2024.

Ellison said, "The business needs to be transitioned." 

Ellison plans to merge two groups, one reporting to McCarthy and the other to Cheeks. While McCarthy was a favored son of former CEO Bob Bakish, Cheeks has a strong relationship with Jeff Shell, who will be Ellison's No. 2 at Paramount. Cheeks and Shell previously worked together at NBCUniversal.

Paramount will also consider strategic partnerships for its cable networks, potentially leading to the sale of some businesses. While Ellison may not actively pursue the sale of these networks as the previous leadership did, he is open to selling nearly any network in the portfolio, except for CBS.

Ellison plans to reduce the company’s real estate holdings and explore selling properties such as the CBS Broadcast Center, which houses productions like 60 Minutes and Last Week Tonight with John Oliver. CBS also owns the Ed Sullivan Theater, home to Stephen Colbert’s late-night show.

“We’re not going to sell Paramount, we’re not going to sell CBS, but we’re looking to maximize value,” Ellison previously told.

The transaction has prompted negotiations between Ellison, Paramount, and the NFL. As part of its broadcasting agreement with CBS, the NFL has the option to opt out, though it currently doesn't plan to do so. However, the league has discussed converting some of its stake in a joint venture with Skydance into an equity stake in Paramount and has also explored the possibility of selling some or all of the NFL Network to Paramount.

The cuts in TV will help fund a larger investment in streaming. Paramount has grown to 72 million customers and has been profitable for two consecutive quarters. However, it ranks last in viewership among mass-market services and remains much smaller than competitors like Netflix, Walt Disney, and Amazon.