Notes on L’Affaire Paramount

And just like that, week after week of speculation about the merger of Paramount Global and Skydance Media has ended with … no deal. Regardless of whether such a mash-up would’ve been a net positive, what’s been striking to me has been how so much of the reporting on the talks has felt like endless bashing of Paramount owner Shari Redstone and covert lobbying for Team Skydance. Industry analysts, anonymous studio execs, and even many reporters seemed hell-bent on getting the deal done, as if David Ellison were the next Bob Iger and his company had some unique genius plan to get Paramount back to the top of media-conglomerate mountain. Really?

I get that Skydance has had a nice run of churning out some hit movies over the past decade (though really, doesn’t Tom Cruise deserve most of the credit for that?). Ellison might have been (and probably one day still will be) a perfectly fine media mogul. But Skydance, to me, didn’t feel like some sort of slam dunk. It didn’t even offer the library synergy and management skill that would have come from a Sony pact. Plus Skydance control of Paramount would have almost surely resulted in hundreds of layoffs, as well as the shuttering of one or more production divisions or units — just as we are likely to (sadly) see now.

Look, I’m not suggesting that Skydance would’ve been some sort of disaster or even the worst-case scenario for Paramount’s future. Nor am I arguing that the current “office of the CEO” executive trio has all the answers. (Saving money by slashing jobs and selling assets is not exactly revolutionary.) But I guess I just sort of get Redstone changing her mind and deciding either that there could be other, better bidders for Paramount and its assets — or that she’s simply better off letting her current managers handle the process of getting the company back on more solid ground.

Sure, it’s entirely possible that she’s just another impudent, extraordinarily wealthy capitalist who wants to hold out for even more money. It’s also possible she was scared off by the incredibly aggressive way Skydance pursued and pushed for this deal to go through, and the endless leaks about every minute detail of the agreement, and decided to go with a gut feeling that this was a bad idea.

There’s a (pretty obnoxious) saying that’s been going around Hollywood since the end of last year’s strikes: “Survive ’til ’25.” It’s basically shorthand for the very common opinion that the industry needs to shake off the worst of the streaming hangover before a sort of rebuild can begin next year, hopefully in a world where interest rates (and the cost of financing projects) are headed lower. Given some bad vibes about Skydance, maybe what happened here is that Redstone figured she’d be better off trying to “survive ’til ’25” before figuring out a way to exit the media business. If so, I can’t blame her for trying — even if she really could have done so a lot less dramatically.