“60 Minutes.” MTV. “The Daily Show.” The future of some of America’s most recognized cultural icons is unknown as the fate of their owner, the Hollywood and media conglomerate Paramount Global, hangs in the balance.
Paramount may be on the verge of being sold, its prospects uncertain. Maybe the possibility of its demise isn’t worth lamenting. Maybe we should just crown Netflix the new king of Hollywood. Perhaps the sources of our next cultural touchstones are to be found on TikTok, Instagram Reels and YouTube, and not in the maze-like corridors of the CBS Broadcast Center on West 57th Street or in Paramount Pictures’ 65-acre Melrose Avenue lot.
Because Paramount Global’s ownership structure gives all power to its largest voting shareholder, the company’s future comes down to the whims of just one person: the 70-year-old heiress Shari Redstone. She chose to put Paramount on the block, and she alone is deciding between a buyer whose strategy could very well further weaken, or kill, these cultural icons — and one that at least allows for some hope of a creative revival. She could, of course, reject both options, and try to maintain what’s left of the status quo. Is this how we want our cultural future to be decided?
One of the two suitors for Paramount is a partnership between Sony Pictures Entertainment and Apollo Global, the alternative asset management behemoth, which wants to break the company up into its component parts and sell many off. That would probably result in new owners for CBS, Showtime, Paramount+, MTV and Comedy Central, risking the already tenuous futures of a set of businesses that would most likely get milked for their cash flow with little capital reinvestment. (Though it’s also possible they could flourish with new ownership.)
The hope in this fragile equation is that the other potential buyer, a partnership between David Ellison and his financial backers, will find a way to revive Paramount’s cultural and financial influence with a new management team and a new strategy. The group, which includes RedBird Capital and KKR, has offered to pay Ms. Redstone a big premium to get voting control of Paramount (leaving other shareholders with only a small fraction of the compensation she’s getting). It would then have Paramount buy Skydance Media, the group’s movie production company, and combine it with the Paramount studio to reap the “synergies.”
That complex deal promises the chance — but hardly the certainty — for a creative and economic revival of Paramount. Last week, the Ellison/RedBird deal won the backing of the special committee of the company’s board, and now it’s up to Ms. Redstone, at her sole discretion, to decide whether to accept it. Then, of course, doing nothing is also an option she could choose.
The relentless deal-making, over decades, that led to the creation of Paramount Global has taken a toll. Once innovative and wildly profitable businesses, such as CBS and MTV, are struggling financially. Morale is low as the sale process drags on. “The inability to come to any decision feeds high anxiety,” one longtime Paramount producer wrote me. Ms. Redstone’s conundrum of whether to sell the company, or not, is only possible due to the decades of wheeling and dealing by her father that made the Redstones one of America’s most powerful media families.
In 1987, Sumner Redstone was a little-known but audacious movie theater operator in Boston when he bought Viacom, the owner of a group of TV and radio stations along with MTV, Nickelodeon and Showtime. Over the ensuing two decades he would go on to gobble up the revered Paramount movie studio (a deal I worked on while I was at Lazard); Blockbuster, the video store giant; and CBS, in one of the biggest media mergers of the 20th century. In 2005, he bought DreamWorks SKG, the Hollywood studio founded by Steven Spielberg, Jeffrey Katzenberg and David Geffen. Regulators never tried to stop Mr. Redstone, presumably because there were always bigger competitors, such as Disney, or G.E., or Comcast, that also were allowed to grow without opposition from Washington.
Hollywood stars flocked to Mr. Redstone’s Beverly Park mansion in Los Angeles and to Dan Tana’s, his favorite restaurant. By granting access to CBS, or Showtime, or Paramount, or MTV or Comedy Central, Mr. Redstone had the power in Hollywood and in Manhattan to make others rich and famous. What made it all work was his attention to detail, his faith in his executives, and his willingness to wield the law (and his Harvard Law degree) as a weapon.
He loved the fight. He once got so angry at two of his direct reports that he ended up spitting out a tooth. “It’s like ‘Apocalypse Now,’” Tom Dooley, Viacom’s chief operating officer at the time, said in 2012. “He loves the smell of napalm in the morning.”
But as he aged, Mr. Redstone made mistakes. He stuck with executives for too long and paid them too generously. His two young girlfriends appeared to control too much of his life. He was late to opportunities, such as streaming, and let others slip away, like the chance to buy Marvel Entertainment. He temporarily barred Tom Cruise from the Paramount lot because he thought Cruise’s devotion to Scientology was hurting business.
As her father’s health deteriorated, Shari Redstone exerted greater and greater control — even though her dad for many years made it known that he didn’t want her involved with the business. After Mr. Redstone died, in 2020, at age 97, she took full legal control of Paramount and set about cleaning house, with new management and new boards of directors, loyal to her.
It hasn’t worked out as Ms. Redstone planned. While she was consolidating her power, Netflix and Apple were innovating and Disney, Comcast and Amazon were getting more formidable. The company she’s putting on the block seems forlorn at best. CBS and the cable channels are in a steep decline amid the rise of streaming, while its own streaming service Paramount+ lost more than $1.6 billion in 2023.
Putting the company up for sale seems only to have hastened Paramount’s decline. In late April, Ms. Redstone tossed out her longtime loyal chief executive, Bob Bakish, in the middle of the sale process, a rare event for sure, and replaced him with three co-chiefs, an even rarer phenomenon. Four board directors quit without explanation. Other potential deals, such as offers to buy Showtime and Paramount+, were passed up either because the prices was deemed too low by management or were never presented by management to the board to be considered. Through it all, Paramount’s market value has dwindled to around $9 billion — down a miserable 90 percent — and the value of the Redstone stake in the media empire has dwindled along with it.
At the annual shareholder meeting on Tuesday, Ms. Redstone praised the performance of her three co-chief executives, who proceeded to lay out their vision for how they would operate Paramount as it is, bolstering at least momentarily the idea she will decide not to sell the company.
What’s been lost in the nearly 40 years of the Redstones’ inveterate deal-making, in addition to enormous shareholder value, are any number of important cultural touchstones that CBS and Paramount once developed and nurtured, like MTV, like CBS News, like all the immense talent that once made Comedy Central iconic.
That happens, of course, as tastes and mores evolve decade after decade. But these losses seem more like self-inflicted wounds that could have been avoided under different stewardship. In sum, the family’s forays into Hollywood as well as into broadcast and cable television have proven to be pretty much an ego-driven failure.
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