Paramount (PARA) Global, the media behemoth that counts CBS, Paramount Pictures and MTV among its portfolio, is set to become the “New Paramount” after merging with Skydance Media in a long-awaited deal that will also see Skydance acquire its parent company National Amusements. The merger means that David Ellison, head of Skydance and the son of Oracle co-founder Larry Ellison, will soon become New Paramount’s chairman and chief executive.
Ellison, 41, is decidedly more youthful than other legacy media leaders like the 64-year-old David Zaslav of Warner Bros. Discovery and the 73-year-old Bob Iger of The Walt Disney Company (DIS). He is also eager to fuse Paramount’s traditional media capabilities with technology, which the incoming CEO describes as necessary in the current media environment. “There are a lot of technology companies that are rapidly expanding into media companies, and we believe it’s essential for Paramount to be able to expand its technological prowess to be both a media and technology enterprise,” Ellison told analysts and investors yesterday (July 8) on a conference call.
While a merger between Paramount and Skydance has been in the making for some time, it appeared to be off the table last month when Shari Redstone, the controlling shareholder of Paramount Global, pulled out of the deal and said the companies could not agree on terms. The transaction was back on earlier this month, with a joint announcement on July 7 from Paramount and Skydance revealing its approval and outlining Ellison’s plan to turn New Paramount into a “creative-driven destination.”
A buying consortium comprised of the Ellison family and the investment firm RedBird Capital Partners will invest $8 billion into Paramount and acquire National Amusements in a transaction expected to close in 2025. “Given the changes in the industry, we want to fortify Paramount for the future while ensuring that content remains king,” said Redstone, the daughter of the late media magnate Sumner Redstone, in a statement. The deal will value the merged company at around $28 billion.
Who is David Ellison?
David Ellison’s involvement in the entertainment industry started early. In 2006, he dropped out of the University of Southern California to act opposite James Franco in Flyboys, a film about WWI fighter pilots. The movie may have flopped at the box office, but Ellison’s onscreen passion for planes was real—the executive has been flying since he was 14 and has participated in airshows and aerobatics competitions.
Launching Skydance in 2010, Ellison’s studio has since gone on to release hits like the 2022 Top Gun: Maverick and the 2023 Mission: Impossible—Dead Reckoning. While Ellison will now have to contend with Paramount’s mounting debt and its struggles to transition from cable to streaming, he appears confident that an emphasis on technology investments and creative content will reinvigorate the company. “The first thing we need to do is double down on the core competencies of storytelling across mediums,” said Ellison during yesterday’s investor call.
When it comes to Paramount+, the media company’s streaming service, Ellison said he intends to “rebuild” the platform. His vision includes improving algorithmic recommendations and advertising technology at Paramount+, in addition to reducing churn and increasing time spent on the engine.
Ellison also discussed his plans for animation by citing lessons from Steve Jobs, the late Apple co-founder who also built Pixar Animation Studios and counted Ellison’s father among his close friends. Jobs, whom Ellison was able to watch “build Pixar from the ground up,” emphasized the importance of a symbiotic relationship between art and technology, said the incoming CEO, adding that a partnership between Skydance ‘s animation studio and Oracle has allowed it to build “a cutting-edge studio in the cloud” that has already been used to help produce the 2024 film Spellbound. The incoming CEO additionally noted his plans to utilize A.I. tools to enhance creativity and production efficiencies.
“If you went into a lab and designed the perfect executive for the next-generation Hollywood company, you would literally spit out David Ellison,” said Jeff Shell, the former CEO of NBCUniversal and New Paramount’s incoming president, of his new boss during yesterday’s conference call. “Because not only can he go to a table read, but he can go to the next room and code, too.”