1 hr ago
Cardinale Says Paramount-WBD Savings Will Mostly Avoid Layoffs
Paramount and Warner Bros.
Discovery are planning a very large merger.
The companies say the deal could save about $6 billion.
Gerry Cardinale says most of those savings will come from things other than firing workers.
Examples include combining computer systems, managing buildings better, and tracking spending.
Some people in Hollywood still expect many jobs to disappear because large mergers often remove duplicate jobs.
Cardinale also praised David Ellison as a trusted and genuine leader.
He said Ellison wants to help Hollywood become more like a technology company.
The merger is expected to close Tuesday.
Gerry Cardinale said most of the promised $6 billion in savings will come from non-labor costs, not layoffs.
The $110 billion Paramount-Warner Bros. Discovery merger is expected to close Tuesday after lengthy negotiations and legal disputes.
Planned savings include combining streaming technology systems, reducing real-estate costs, improving spending oversight, and optimizing marketing.
Hollywood workers and independent analysts have nevertheless anticipated significant job cuts because mergers often eliminate overlapping roles.
Cardinale defended CEO David Ellison’s leadership and said technology investment is essential for Hollywood to compete with Silicon Valley.
- Who
- Gerry Cardinale, Paramount, Warner Bros. Discovery, and CEO David Ellison are central to the report.
- What
- Paramount and Warner Bros. Discovery are preparing a $110 billion merger expected to produce $6 billion in cost savings.
- Where
- The remarks were made at the Bloomberg Screentime conference; the companies operate in Hollywood and the entertainment industry.
- When
- Cardinale discussed the deal Thursday; the merger is expected to close Tuesday.
- Why
- The companies aim to reduce costs and build a more technology-focused business that can compete with Silicon Valley companies.
Cardinale’s Position
Layoff Concerns
Source of cost savings
Cardinale’s Position
Most savings will come from non-labor areas such as technology systems, real estate, financial oversight, and marketing.
Layoff Concerns
Hollywood workers, independent analysts, and the history of previous mergers suggest that substantial layoffs may still result.
Impact on employees
Cardinale’s Position
Cardinale said labor-related cost reductions are not driving the promised $6 billion in savings.
Layoff Concerns
The merger is expected by critics to eliminate overlapping jobs across the combined companies, even if non-labor savings are emphasized.
David Ellison’s leadership
Cardinale’s Position
Cardinale described Ellison as humble, genuine, talented at attracting loyal employees, and committed to Hollywood.
Layoff Concerns
Critics have questioned whether Ellison’s rise reflects nepotism because his father, Larry Ellison, is one of the world’s richest men.
Key facts
- Transaction value
- $110 billion
- Expected cost savings
- $6 billion
- Main savings source cited by Cardinale
- Non-labor costs
- Technology plan
- Unify direct-to-consumer technology systems, including the HBO universe
- Other savings areas
- Real estate, enterprise resource planning, spending oversight, and marketing
- Expected closing
- Tuesday
- Conference where remarks were made
- Bloomberg Screentime
Quotes
Gerry Cardinale
Paramount board member and RedBird Capital founder
“That notion that $6 billion of cost-related synergies means you’re firing all these people is just completely antiquated. If you look at what we have in front of us, most the majority of those cost synergies are related to non-labor spend.”
deadline.com
“He’s 43 years old, and look at the talent that he attracts. People are incredibly loyal to him. You can’t fake that. And let me tell you, there’s no last name in the world that delivers that.”
deadline.com
Sources
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