Skydance employees brace for expected restructure as megamerger dust settles

The newly formed Skydance media empire is facing a period of uncertainty following its $110bn (£82bn) merger of Paramount and Warner Bros Discovery. With an aggressive target of reducing $80bn in debt within three years, employees are bracing for significant changes. "It feels like the calm before the storm," says one Skydance executive, noting that while CEO David Ellison achieved his merger goals, "now there is a price to pay."

Ellison, who sealed the deal after fending off a rival bid from Netflix and overcoming political opposition, has set a goal of $6bn in savings. While executives are trying to avoid widespread job losses, a recent management memo warned that "difficult decisions that affect our workforce" would be necessary. "It is business as usual but, to be honest, everyone is worried about what happens next," another executive admitted.

Political Concerns

The merger has raised concerns about the political direction of the new entity, given Ellison's closeness to Donald Trump. Ellison has pushed back against such framing, stating: "We do not want to politicise the company." Nevertheless, fears in the news division have been stoked by events at Paramount before the merger, including the cancellation of The Late Show with Stephen Colbert after its host alleged the network paid a "big fat bribe" to settle a $16m lawsuit with Trump.

News Division Turmoil

CNN's international anchor Christiane Amanpour announced she was leaving the network after 43 years, though her exit isn't directly tied to the new ownership. She had previously criticised the "ideological realignment of CBS" and warned that changes could lead to the "destruction" of flagship news show 60 Minutes. Many CNN staff were relieved when Skydance decided to keep Mark Thompson, former New York Times boss and BBC director general, as chair and CEO.

Fresh concerns emerged this week when it was reported that Elon Musk, a Trump ally, has invested $1bn for a stake in the media conglomerate. Meanwhile, Ellison has extended Casey Bloys' contract, promoting the HBO boss to also oversee streaming services Paramount+ and HBO Max, ensuring continued production of hits like The White Lotus and Game of Thrones.

Asset Strategy

The conglomerate's cable and TV channels like MTV, Nickelodeon, Channel 5 and Network 10 are in decline but still account for 70% of profits. Analysts suggest these physical broadcast assets could be sold, though Channel 5 has committed to operating as a free-to-air broadcaster until at least 2034. The merger also paves the way for BT to exit its joint venture with Warner Bros Discovery's TNT Sports, ending the telecom company's costly foray into pay-TV sport.

Skydance promises to spend $30bn annually on content across all divisions and release at least 30 major films yearly until 2031. This promises benefits for the UK production industry, particularly at Warner Bros' Leavesden studio, home to DC franchises and the upcoming Harry Potter TV series. However, analysts note Ellison is unlikely to maintain that level of moviemaking beyond the five-year pledge, as it contradicts Hollywood's trend toward fewer releases following major acquisitions.