Inside Skydance's $110bn Empire: $6bn of Cuts and 53,000 Anxious Staff

David Ellison closed an $110bn (£82bn) merger this month that fused Paramount and Warner Bros Discovery into a single Skydance-run empire — and now he owes the balance sheet more than $80bn within three years. The company's 53,000-plus employees are bracing for what comes next. "It feels like the calm before the storm," one Skydance executive said. "David has got what he wanted, but now there is a price to pay."

Ellison, 43, has set a $6bn cost-savings target over three years. Executives and financial backers are steering away from the need for swingeing job losses, but a management memo earlier this month warned of "difficult decisions that affect our workforce." Another executive put it bluntly: "Cuts inevitably mean jobs."

The deal, which saw off a rival bid from Netflix, spans two century-old Hollywood studios, the HBO, MTV and Discovery networks, CBS and CNN. Ellison told staff the process was at times "downright ugly."

What does the merger change for the newsrooms?

Political anxiety runs through the news divisions. Ellison is close to Donald Trump — a longtime friend of his father, Oracle co-founder Larry Ellison — and the CEO has pushed back at that framing: "We do not want to politicise the company."

US regulators approved the Paramount-Skydance combination — an $8.4bn transaction — days after Paramount cancelled the Late Show with Stephen Colbert, whose host said the network had paid a "big fat bribe" in settling a $16m lawsuit with Trump. One condition of approval: Trump ally Kenneth Weinstein becomes ombudsman at CBS News to root out "complaints of bias."

CNN's Christiane Amanpour criticised the "ideological realignment of CBS" and warned cuts could lead to the potential "destruction" of 60 Minutes. She announced this week she is leaving CNN after 43 years, though her exit is not thought to be tied to the new ownership. Staff were relieved that Mark Thompson, the former New York Times chief and BBC director general, stays on as CNN's chair and CEO, averting a feared installation of CBS News editor-in-chief Bari Weiss. Fresh concerns surfaced this week when it was reported that Elon Musk has invested $1bn for a stake in the conglomerate.

"The preservation of editorial independence is a growing concern among media consumers," said Forrester analyst Mike Proulx. "Private wealth is getting a greater foothold on public information channels."

What happens to the TV channels and streaming?

Ellison immediately extended HBO boss Casey Bloys' contract and handed him oversight of Paramount+ and HBO Max, keeping the hits flowing — The White Lotus, Game of Thrones, The Pitt, Succession and The Sopranos.

The trickier question is cable. Declining channels such as MTV, Nickelodeon, Channel 5 and Australia's Network 10 still generate 70% of profits, according to CreditSights. "In a world where the majority of consumers can access content through a smart TV, it should be a natural consideration to sell physical broadcast assets," said Brian Wieser, CEO of consultancy Madison and Wall — though he noted Skydance "might be better served to hold on" if offers fall short.

UK Culture Secretary approval came with a pledge to keep Channel 5 free-to-air until at least the end of 2034 — but sources say that doesn't preclude a future sale. Newly filed accounts show Channel 5 paid a £215m dividend to Paramount last year.

In advertising, Paramount moved its £300m UK ad sales business from Sky to Channel 4, and WBD extended Sky's handling of its £90m-£100m business — though media sources expect that to shift to Channel 4 too. The deal also lets BT exit its TNT Sports joint venture, ending a costly 15-year pay-TV sports run after Paramount outbid WBD for Champions League rights; with Paramount+ merging into HBO Max, top-flight football stays on one service.

Can 30 films a year last?

Skydance plans roughly $30bn a year on content and has promised at least 30 major films annually until 2031 — good news for the UK, especially WBD's Leavesden studio, home to the DC franchises and the Harry Potter TV series heading to HBO Max this Christmas. Warner's box office is suffering, with Tom Cruise's Digger the latest flop, prompting Ellison to put Paramount leadership over both studios.

Don't expect the film volume to stick. Since Disney's 2019 acquisition of Murdoch's entertainment assets, releases have broadly halved. "After the 2031 deal ends there will be fewer films, obviously," said Enders analyst Tom Harrington. "It has never happened before when there has been a takeover that more have ended up being made." Skydance declined to comment.

For practitioners, the near-term signals are clear: $6bn of cuts, a debt clock ticking toward 2028, and asset sales — from Channel 5 to ad sales contracts — that now look live options rather than rumours.