After a controversial merger with Skydance, Paramount took another huge step and laid off 1,000 of its workers.
The CEO, David Ellison, who assumed the role after the merger, sent a memo to Paramount employees on Oct. 29 explaining that they had made the decision to align with their “evolving priorities.”
“They’re evolving to make sure that they’re positioned correctly for the new frontier that we’re moving into with entertainment,” said John Rowe, a business teacher at Carlmont.
The cuts have followed the general trend of the entertainment industry, as companies such as Disney, Warner Bros., and others in the sector have all recently undergone major layoffs.
Many of these cuts stem from the changes occurring in the entertainment industry as it moves towards streaming.
“More and more people want their entertainment, not necessarily getting it from movies or from broadcast television through your TV, but through streaming,” Rowe said.
Streaming platforms like Disney+, Paramount+, Netflix, and Hulu have become major successes for their parent companies. In recent years, these platforms have been far more profitable than theatrical releases, as people are reluctant to return to theaters to watch movies. Many people wait for movies to be released on these streaming platforms.
“Pretty much all of the movies I watch are on streaming platforms,” said Carlmont sophomore Matthew Edwards.
As a result, many companies are leaning heavily towards streaming and laying off employees from other parts of their organization to focus on it. Paramount, specifically, invested in streaming as its layoffs took place, acquiring South Park and securing streaming rights to the Ultimate Fighting Championship (UFC).
Despite the success of streaming, the overall entertainment industry has struggled since the COVID-19 pandemic. Over 270,000 workers in the entertainment industry lost their jobs, according to a Bureau of Labor Statistics report. The job market in entertainment has not recovered from then.
For individuals seeking jobs in the entertainment industry, the layoffs have created additional uncertainty.
“The job market is constantly changing, so companies may hire again by next year,” said Stephanie Jacobovitz, the college and career specialist at Carlmont.
The competition in the streaming industry is also fierce, making the future uncertain for even the companies investing in it.
“You’re seeing companies like Amazon and Apple all jump into the space,” Rowe said. “Some companies are going to invest a lot of money, and it’s not going to pay off for them.”
Overall, many believe the future of the entertainment industry remains uncertain.
“The economy and employment are like a pendulum, constantly shifting,” Jacobovitz said.
