They got their answer on Sept. 24, when hundreds of workers in New York and California were notified on a Zoom call that they would receive an email if they were among the unlucky staffers who would be losing their jobs—and that the message would arrive in an hour.
There is no perfect way to conduct layoffs, especially in a hybrid workplace. Still, according to former employees who were impacted by job cuts, and spoke to Fortune anonymously for fear of retribution, this 60-minute waiting game felt exceptionally grim. It seemed in line, however, with the atmosphere at the company over the past several months: full of tension, grief, and uncertainty. Or as one employee put it, “Honestly traumatizing, honestly inhumane.”
Paramount Global—home to movie studio Paramount Pictures, CBS, and culture-defining networks like MTV, BET, Comedy Central, and Nickelodeon—is hardly the only legacy entertainment company shedding employees. Several others have been squeezed lately, as disruption rocks the industry. But in 2024, Paramount let go of some 2,000 workers, more than Warner Bros., Disney, or Netflix combined.
The brutal belt-tightening is a culmination of several years of instability and mismanagement, which began long ago with a family power struggle and was defined in 2024 by on-again, off-again dealmaking, high-level executive outings, and a confusing C-suite structure that saw three leaders appointed co-CEOs. In what employees saw as an ironic and infuriating twist, those “three-e-o’s,” as employees nicknamed the executives, led a restructuring plan that called for reducing redundancies.
“There are incredibly talented people at Paramount, so decisions to streamline are difficult, but they are necessary to transform the company for the streaming age,” Paramount said in a statement to Fortune. “This means operating more efficiently and rightsizing our cost base, while continuing to invest in what Paramount does best—create big, broad hits.”
But the forces at play at Paramount epitomize what happens when a creative enterprise and industry face massive disruption. New technologies emerge and challenge the giants, whose financial positions start to waver. That leads to corporate consolidation and paves the way for hedge funds and private equity firms, looking to extract what they can from the industry’s creative workers and media company’s catalog. The chaotic, messy years that follow are marked by abrupt closures and Machiavellian executive maneuvering. In the end it’s not just the business or industry that gets disrupted, it’s also the lives of the people who work there.
It wasn’t always such a grim scene at Paramount.
The studio famous for classics like The Godfather and Chinatown came under the control of the late media mogul Sumner Redstone in the mid-1990s, and went on to produce iconic films like Top Gun and Titanic. Redstone, whom Fortune once called “a tenacious and belligerent striver,” already owned Viacom and later purchased powerhouse network CBS, Viacom’s former parent, merging, then separating, and then remerging the two companies over decades.
Redstone died in 2020 at the age of 97. But the battle for control of his empire had begun years before that, even before his health severely declined in 2014. That conflict pitted his daughter, Shari Redstone, against her father's younger girlfriends, as well as one of his deputies, Les Moonves, the former CEO of CBS. In 2019, Shari Redstone emerged from a legal battle as the owner of ViacomCBS, later rebranded Paramount Global, and appointed Viacom CEO Bob Bakish as chief executive of the unified company.
Though long past its golden era, Paramount Global was still an exciting place to work in the late 2010s, former employees say. It was the kind of company that threw glamorous holiday parties with celebrity guests like Snoop Dogg, Nick Jonas, and the Roots. The day-to-day felt buzzy and exciting, with a sense of a company going places. “Everything was really spectacular,” says the first former employee.
There was celebration about this being the most-watched televised event since the moon landing, and then a bunch of people got laid off.
But some of that go-go energy would be zapped by the pandemic, when staff was sent home to telecommute. More importantly, the company’s deteriorating financials began wrecking the vibe, especially as most of its cable networks, like the rest of the industry, saw a decline in audience and advertisers. With the exception of a spike to more than $90 per share in 2021, based on a brief burst of high hopes for the newly launched Paramount streaming service, the company’s stock has trended downward for seven years.
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Other entertainment companies have also struggled to maintain their footing in a fragmented business landscape as customers drop their cable services in favor of streaming options from Netflix, Amazon, and Apple, and young audiences flock to YouTube and TikTok. But Paramount’s management backstory and heavy exposure to the crumbling cable model set it apart from other media companies experiencing the same headwinds.
Analysts and media watchers say Bakish and Redstone missed crucial opportunities to sell off parts of the business like Showtime and BET, and didn’t innovate with content and products in the same way their peers did. Redstone felt she had little choice but to focus on protecting her family business, according to sources close to the matter. Shari Redstone declined to comment.
By early 2024, with the century-old institution slipping into a doom spiral, its board formed a special committee to begin evaluating offers.
The prospect of a Paramount sale attracted some of the biggest players in media, including Byron Allen, Edgar Bronfman Jr., David Zaslav, and Barry Diller. But it was David Ellison, founder and CEO of Skydance, together with private equity firm RedBird Capital, that ultimately won with a bid of $8 billion.
The behind-the-scenes machinations made for spectacular business headlines, but former staffers who spoke to Fortune say that these high-stakes financial war games playing out at the board level created anxiety for employees.
In an internal memo sent to employees in January, even before deal talks intensified, then-CEO Bob Bakish informed staffers that as the company streamlined operations and pursued a shared-services model that would centralize certain functions, job cuts were coming. “These decisions are never easy, but are essential on our path to earnings growth,” he wrote in a memo shared with Fortune.
In February, Paramount laid off roughly 800 employees across the company, including at CBS. That was just two days after the network aired Super Bowl LVIII which drew the largest audience for a single network broadcast in television history.
“There was celebration about this being the most-watched televised event since the moon landing, and then a bunch of people got laid off,” an ex-employee says.
Later that month, the company dropped a bomb that few saw coming: Bakish was sent packing. Shari Redstone and Bakish had a tight relationship for many years, but they clashed when—among other reported problems—Bakish said he had reservations about the Skydance merger. The board had also lost faith in Bakish’s long-term strategy.
There’s nothing redundant about three CEOs at all and yet they’re the ones that are sorting out redundancies. The jokes write themselves, right?
It was an abrupt departure for the leader who had joined Viacom in 1997 and was so ensconced as a CEO that he had christened the companywide town hall meetings “Bob Live.” But the company didn’t dwell on his goodbye: Bakish’s exit was announced in an earnings call that lasted nine minutes and ended not with the usual questions from analysts but with the theme song to Mission: Impossible playing on a loop.
With Bakish out, employees were introduced to a trifecta of CEOs to replace him. The trio, who still run the company, are George Cheeks, president and CEO of CBS; Chris McCarthy, president and CEO of Showtime and MTV Entertainment Studios; and Brian Robbins, president and CEO of Paramount Pictures and Nickelodeon. All three continue to hold those roles while working as co-CEOs.
Putting three executives in charge seemed like a particularly insulting choice, ex-employees say, especially when it was revealed at a Los Angeles town hall in late June that the trio would slash “redundant functions” in their quest to find yearly cost savings of $500 million.
The three executives’ salaries as co-CEOs are so far unknown. (For context, Bakish earned $31.1 million in 2023.) Corporate filings revealed only that Cheeks, McCarthy, and Robbins are eligible for twice their current salary in severance should they be let go because of restructuring after the merger.
“There’s nothing redundant about three CEOs at all and yet they’re the ones that are sorting out redundancies,” a third former employee tells Fortune. “The jokes write themselves, right?”
By the time of that June meeting, employees were aware that Paramount’s board had come close to a deal with Skydance, only for the talks to fall apart again at the 11th hour. (They would be revived in early July.) Paramount also shuttered its TV studio in August.
On Aug. 13, the company revealed during a second-quarter earnings call that another culling would begin that day, to be conducted in three parts. The CEOs gave employees a clearer picture of what to expect: By the end of 2024, layoffs would eventually impact 15% of U.S. staff or about 2,000 people. Paramount also took a $6 billion write-down on its broadcast TV networks.
The hardest part of the past year, according to a former employee who survived the February job cuts, was the period after that August announcement, while workers were waiting for the next promised wave to break. “We knew that our particular division was going to be impacted,” they said. “It was just kind of six weeks of nonstop stress.”
On Sept. 24, hundreds of staff members on both coasts found themselves unemployed following the dreaded email waiting game, though employees say that some tearful managers intervened to break the news to them directly. According to the company, 90% of its layoffs were complete with this round, with the remaining 10% set to arrive by year’s end.
Public documents filed weeks after the September bloodbath show that the board had upped the severance package for the three CEOs so that each one would receive stock options worth $3 million if they were let go. The new agreement also shows that all three men will continue to earn their current undisclosed CEO salary even if they are no longer co-chiefs but still employed by Paramount.
“Why are you talking about cost-saving measures [to justify layoffs] when these CEOs are getting additional compensation? It doesn’t make any sense,” says a former employee.
One New York worker has filed a class action lawsuit against Paramount Global for allegedly violating the WARN act, and workers in California have sent a letter to the company accusing it of effectively “union busting.”
A Paramount spokesperson said the lawsuit was “not grounded in any fact.” Regarding the allegations of union-busting, the company said in a statement, “Our goal is to best position Paramount for the future, which means we are also called upon to make difficult decisions that impact colleagues who have made valuable contributions.”
Ellison hasn’t shared many details about his plan for the new media and tech hybrid version of Paramount, but he said in July that he has identified $2 billion in “cost synergies” to be implemented once Skydance and Paramount merge and he becomes CEO. He has not explained how those synergies might impact the workforce. Skydance declined to comment.
Andrew deWaard, assistant professor of media and popular culture at the University of California, San Diego, and author of Derivative Media: How Wall Street Devours Culture, believes there’s more pain to come for Paramount employees. Pointing to RedBird’s involvement, he argues that the merger represents what he calls the “financialization” of Hollywood, with purely numbers-driven owners trying to mine the assets and catalogs for dollars, similar to what happened with the music industry.
“What we’re left with is a lot less diversity, less creative output, less opportunities for workers, lower wages,” he argues. And the tough year for Paramount employees may be just the beginning for a years-long reckoning across the industry. Indeed, deWaard adds, “It might be a decade from hell.”
This story was originally featured on Fortune.com