A successful legacy of informing and entertaining viewers is no longer sufficient to keep cable TV networks at the top of their game. Paramount Global has announced layoffs across the company, an inevitable outcome following the rising cuts in the media industry. Paramount’s workforce reduction plans will affect 3.5% of US jobs which is expected to add up to several hundred employees across the organization.
The Paramount cuts emerging amid the streaming shift were announced on Tuesday via a memo shared with employees, with a note that affected employees would be soon informed of the change within the day. The decline of traditional TV has been ramped up by streaming services, and while many cable providers have attempted to reinforce their relevance by altering their programming, there is little room for such businesses to reassert their presence in the industry. Despite offering a parallel streaming service as well, Paramount has been faced with mounting challenges.
The Paramount layoffs mark another hit to the media and entertainment industry. (Image: Pexels)
Paramount Layoffs Come for 3.5% of the US Workforce
On Tuesday, Paramount announced layoffs at its organization, with a 3.5% workforce cut as its response to the challenges of staying afloat in the US economy and facing the struggles posed to the cable industry. The memo to employees was sent from the office of the three co-CEOs—George Cheeks, Chris McCarthy, and Brian Robbins. The memo expanded on the plan to cut workers in the US wing of the business, addressing the possibility of layoffs at locations outside the country at a future date if necessary.
“As we navigate the continued industry-wide linear declines and dynamic macro-economic environment while prioritizing investments in our growing streaming business, we are taking the hard, but necessary steps to further streamline our organization starting this week,” the co-CEOs explained.
According to CBS News, at the end of 2024, the company had 18,600 full- and part-time workers, spread across 32 countries. The company shed 15% of its US workforce last year to prune its cost by $500 million, which makes the fresh round of cuts more limited but still intimidating to the workers who will be affected.
Paramount’s Cost-Cutting Comes in Preparation of a Merger
Paramount’s workforce reduction plans appear to be an emergency solution as it waits out the $8 billion merger with Skydance Media. The previous round of cuts conducted at the organization was significantly larger in scale and was spread out in phases to slow down the impact it had on the business. This time, Paramount’s 3.5% workforce cuts were instantaneous, rolling out the same day it was announced.
The company’s merger plans have been repeatedly interrupted, now being halted in anticipation of approval from the FCC and a targeted attack from the administration. Paramount had previously attempted to complete the merger last year but later revised its target to hope it would be completed in the first half of 2025. Now, this deadline is also passing by, with no indication of when the deal will be closed.
The Cable TV Slump Is Spurring on Job Losses
The Paramount cuts amid the streaming shift are not occurring in isolation. Despite having expanded to streaming with Paramount+, the business is still struggling to keep up with major streaming platforms that have swallowed up a major chunk of the industry. Disney, despite its successful streaming platform, also announced cuts recently as the trend of cord-cutting left a lasting mark on its revenue.
Warner Bros. Discovery also initiated double-digit layoffs within its cable business, with the company looking at massive reorganization efforts to segment itself into two wings—Global Linear Networks and Studios and Streaming. Comcast previously kickstarted a similar move to make its cable networks into a separate entity.
The changes in the media industry come as businesses struggle to determine the right approach to bring their media and entertainment offerings to the public. The falling demand and rising competition make for a dangerous stew as businesses attempt to strike the right balance without losing their position or power in the market. The demand for cable TV is unlikely to go back up but there are still enough users of these services that make keeping the business afloat worthwhile.
Will the recent round of layoffs at Paramount be enough to see it through or will we see more cuts in the coming months? Only time will tell. The domestic workforce cuts at Paramount may be sufficient for now, but we expect more downsizing in the company’s international wings by the end of the year.
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