Paramount Downsizes Workforce2 Oct, 2013 By: Erik Gruenwedel
Layoffs are across the studio, including international home media distribution
Paramount Pictures is downsizing its global workforce, layoffs that affect about 110 positions across finance, home resources, IT and international home media distribution.
In an Oct. 1 memo sent to employees, COO Frederick Huntsberry said ongoing competitive landscape for movies precipitated the cuts.
Indeed, the studio through the first nine months of the year saw revenue decline 18% to $3.1 billion, compared with the prior-year period. Home entertainment revenue dropped 34% while TV license revenue fell 12%. Paramount posted an operating loss of $68 million, compared with operating income of $12 million last year.
“As our industry continues to adapt to an increasingly competitive environment, we are always ensuring that Paramount is conducting its business as efficiently and productively as possible,” Huntsberry said in the memo. “Change is always difficult and we never take these steps lightly. We are confident that these changes will allow us to manage our business with greater speed and flexibility and fully capitalize on opportunities in the global entertainment market.”
Philippe Dauman, CEO of parent Viacom, speaking recently to an investor group in New York, said the cyclical nature of the movie business makes it hard to predict. He said Paramount has done a good job branding itself overseas launching classic movie channels for regional multichannel video program distributor such as cable, satellite and telco.
“Our legacy of success stretches back more than 100 years, with a deep history of adjusting to our industry’s challenges and realizing its new opportunities — all while creating the world’s most iconic films and entertainment experiences,” he said.