Paramount Is Firing A Huge Percentage of People And Shutting Down An Entire Department
Paramount Global has laid off a quarter of it domestic work force: over 6,000 people.
Paramount tells Disney and Warner Discovery to hold its beer as the entertainment juggernaut begins its own round of downsizing. According to The Hollywood Reporter, Paramount Global’s Chris McCarthy has overseen a round of layoffs that slashed a quarter of the company’s domestic team. That’s roughly 6,125 workers who are now without a job as of yesterday.
The cuts don’t stop there. Paramount has completely eliminated its MTV News unit ending its nearly 40-year run. The news division of MTV started sometime in the late ’80s and has existed in one form or another up until yesterday when McCarthy officially gave the legendary institution the axe.
McCarthy issued a memo to Paramount staff detailing the logistics behind the layoffs and internal restructuring. According to the CEO, the cuts come as Paramount finalizes the “integration of SHOWTIME” into its cable and streaming services. The memo goes on to state that Paramount will now have two divisions, “studios,” which combine Showtime and MTV Entertainment Studios into one singular force, and “networks,” which will see the corporation merging nine separate teams into one portfolio group.
What any of that means outside of the memo’s corporate jargon is anyone’s guess. What is known, though, is just what motivated the layoffs, profit, or rather lack of. Paramount Global recently posted quarterly earnings that fell well below expectations.
On top of that, Paramount has experienced an 11 percent drop in TV ad revenue.
Paramount’s cuts are just part of a larger trend that’s seeing fellow conglomerates such as Warner Bros. Discovery cancel projects left and right while undergoing a similar corporate reorganization. Meanwhile, Disney, a name synonymous with family entertainment, is in the process of leaving 7,000 family members without jobs.
This larger round of cuts follows last year’s resignation of longtime Showtime exec David Nevins and the other Showtime alumnus that followed, including President Jana Winograde. In the time since Nevin’s departure, Chris McCarthy has been retooling Showtime’s brand in their absence. McCarthy’s reimagining of the Showtime brand focuses on three categories of programming: diverse cultures, antiheroes, and high-stakes worlds.
Anything not fitting those admittedly broad categories has been shelved or sold elsewhere.
Curiously, all of the belt-tightening being done by Hollywood’s entertainment juggernauts seems to run at odds with the current WGA strike. The writers are under the impression that the age of streaming has resulted in an unprecedented windfall for their corporate overlords, and understandably feel entitled to their fair share of the loot. At the same time, Paramount, Disney, Warner Bros., Netflix, and the like are cutting content and rethinking their business models due to profits falling well short of production costs.
The problem seems to lie in the disconnect between subscriber numbers and actual profit. McCarthy even states in his memo that thanks to hits like the Yellowstone spinoff 1923, Tulsa King, South Park, Drag Race, Yellowjackets, and a slew of other successful titles, Paramount+ leads the industry in new subscriber growth. Somehow all the new subscribers aren’t equaling all the new monies.
It’s a complicated issue with no solutions, it would seem, other than massive layoffs and 86ing departments like MTV News that aren’t pulling their weight anymore. Hopefully, Paramount and all of the other companies will soon find a way to fix things without firing thousands of employees. One can only hope.