Skydance Acquires Paramount, Restructures with Tech-Forward Strategy
The protracted acquisition of CBS parent company Paramount Global by Skydance Media has finally concluded, marking an $8 billion transaction that ushers in a new era for the media conglomerate. Now officially christened “Paramount, a Skydance Corporation,” the merged entity is immediately undergoing a significant overhaul under the leadership of incoming Chairman and CEO David Ellison.
Ellison wasted no time outlining his strategic vision in an open letter, announcing a sweeping restructuring that will divide the new company into three core units: studios, direct-to-consumer, and TV media. This reorganization, he explained, is designed to dramatically enhance efficiency as the enterprise transitions its entire technological infrastructure to a single, unified platform. This consolidation is projected to yield substantial benefits, not only reducing technology expenditures but also boosting performance and empowering leaders across the organization to make more agile and informed decisions. Ellison expressed strong confidence that these initiatives, combined with broader cost-saving measures across labor, real estate, procurement, and workflow, will enable the company to surpass its previously stated goal of achieving $2 billion in real efficiencies.
Under Ellison’s direction, the new Paramount is poised to embrace a “tech-forward” identity, drawing inspiration from Silicon Valley. He cited several technological advancements he intends to see more widely implemented, including AI-assisted translation, virtual sound stages, and proprietary advertising technology stacks. A major step in this technological pivot will occur next year, with plans to migrate both Paramount Plus and Pluto TV onto a unified technology stack. This integration aims to elevate the consumer experience by enhancing recommendation engines, accelerating content delivery, and strategically positioning Pluto TV as a “top of the funnel” to attract new subscribers to Paramount Plus.
The completion of this monumental deal also necessitated significant shifts in corporate control. It paved the way for Larry Ellison, Skydance, and RedBird Capital to acquire all of Paramount chairwoman Shari Redstone’s shares in National Amusements Inc. (NAI), which had served as Paramount Global’s controlling shareholder. As a result, Shari Redstone will not join the new Paramount’s board of directors, and NAI shareholders collectively received $1.75 billion in cash from the transaction.
The launch of the new company follows weeks after the Federal Communications Commission (FCC) granted its approval for the merger. This regulatory green light was notably contingent upon Skydance and Paramount’s willingness to address the Trump administration’s push to curtail diversity, equity, and inclusion (DEI) initiatives within corporate America. FCC Chairman Brendan Carr publicly stated that Skydance had provided written commitments to ensure the new company’s programming would reflect a broad spectrum of political and ideological viewpoints. Furthermore, Skydance agreed to “adopt measures that can root out the bias that has undermined trust in the national news media,” leading to the establishment of an ombudsman tasked with addressing complaints about “bias or other concerns” directly to the president of CBS News.
Adding another layer of political complexity, the FCC’s approval also hinged on Paramount’s agreement to pay $16 million to settle a lawsuit filed by Donald Trump. The lawsuit alleged that CBS News had deceptively edited a 60 Minutes interview with Kamala Harris, misleading voters during the 2024 elections. While one legal expert characterized Trump’s lawsuit as “so ill grounded that it comes close to being sanctionable as frivolous,” Paramount’s decision to settle was widely seen as a pragmatic move to avoid jeopardizing Skydance’s chances of securing the merger. This substantial payout is also speculated by many to have contributed to the “financial” considerations behind CBS’s decision to cancel The Late Show With Stephen Colbert just last month. Ultimately, as the dust settles, the intricate web of these deals reveals a clear underlying motive: the substantial payout for key shareholders.