Jeff Shell as Paramount president might have runway to make daring modifications

Lower than two years after NBCUniversal fired Jeff Shell for alleged sexual harassment, the previous CEO is near discovering himself again within the saddle main a storied media firm.

The longtime media govt is primed to assist run the day-to-day media operations of Paramount International as president of the corporate when its merger with Skydance Media closes within the first half of 2025, assuming regulatory approval. He’ll report back to present Skydance CEO David Ellison, who will take the highest job because the mixed firm’s CEO.

Whereas neither Shell nor Ellison has publicly declared particular intentions for Paramount International resulting from laws banning “gun-jumping” in pending mergers, Shell’s current tenure because the CEO of Comcast’s NBCUniversal, the dad or mum firm of CNBC, gives clues to what could also be in retailer for Paramount.

CNBC spoke with a dozen individuals who labored intently with Shell throughout his tenure as CEO from 2019 to 2023. They described Shell as an individual with huge concepts and a willingness to make daring strikes however with a method that relies on these round him to speak him out of selections that won’t make sense. A few of Shell’s boldest concepts — equivalent to giving NBC’s 10 p.m. hour over to associates, merging with a rival, and turning CNBC primetime right into a Fox Information facsimile — by no means performed out.

Comcast CEO Brian Roberts selected Shell to interchange Steve Burke as NBCUniversal CEO in 2019. Shell had constant success operating a wide range of completely different divisions inside Comcast and NBCUniversal, together with NBCU Worldwide and Common Filmed Leisure Group.

Colleagues advised CNBC they discovered Shell to be a great listener and a collaborative decision-maker with a predilection for typically saying an excessive amount of. His departure from NBCUniversal was sudden. In April 2023, a Comcast investigation corroborated allegations from a former CNBC reporter of sexual harassment. Shell joined personal fairness agency RedBird Capital Companions in February. RedBird backed the Skydance-Paramount merger and can assume a minority fairness stake.

Quickly, Shell, 59, will probably be on the helm of Paramount and paired with Ellison, who has already expressed his want to transition Paramount right into a extra trendy media firm. Which will arrange a dynamic the place Paramount’s CEO and president each need daring change.

RedBird executives praised Shell throughout a convention name in July asserting the merger, with RedBird Associate Andrew Brandon-Gordon saying Shell’s “long-term, results-oriented, proven track record at NBCUniversal” coupled with Ellison’s creativity and tech savvy make for the right management dynamic for the way forward for Paramount.

Nonetheless, it is doable the pairing might result in rash decision-making, warned one govt who labored intently with Shell at NBCUniversal. Even the consideration of dramatic concepts can destabilize a company if mentioned overtly with out comply with by way of, and Shell developed a fame at NBCUniversal for what one former coworker described as a “shoot first and aim later” mentality — a sentiment shared by a minimum of six others who spoke with CNBC.

“What Paramount needs is blocking and tackling — mature leadership,” stated the manager who labored intently with Shell. “Ellison is a blow-everything-up guy, and Shell needs someone who can minimize his mistakes.”

Shell and Ellison each declined to remark for this story.

At Paramount, Shell will probably be given an asset combine much like what he oversaw at NBCUniversal — save the theme parks. He’ll have a serious broadcast community with NFL rights (CBS), a film studio (Paramount Photos), a streaming service with tens of hundreds of thousands of subscribers (Paramount+), a big library of TV exhibits and movies, and a slew of cable networks with dwindling audiences.

It is going to be Shell’s mission to chop prices — Skydance has already recognized $2 billion in value efficiencies and synergies, the corporate stated throughout a July convention name with buyers in regards to the merger — and rework Paramount International into a contemporary media firm. That possible means making daring modifications to declining companies whereas investing in expertise.

Shell might attempt to resurrect the concept of giving up the ten p.m. hour — as he contemplated at NBC — for CBS, Paramount International’s nationwide broadcast community, individuals who spoke to CNBC steered. Bailing on the hour would save CBS hundreds of thousands on content material prices. Native associates would welcome gaining the hour as a option to increase promoting income.

Throughout a 2022 CNBC interview, Shell confirmed a Wall Road Journal report that he was contemplating ceding the hour to native associates to shift sources from linear broadcast TV towards streaming.

“If we’re being prudent operators, which we try to be, if you’re allocating a bunch of resources to one side of the business, you have to look at the allocation of resources to another,” Shell advised CNBC’s David Faber on the time. “We make a lot of money at 10 o’clock. We still have a lot of viewers at 10 o’clock. There’s no question throughout the day as linear declines, you’re going to have to make some tradeoffs, and we’ll be looking at that as our investors would want us to look at.”

The ten p.m. hour on broadcast networks nonetheless serves as a time slot for scripted dramas — a style that is largely gone to streaming and, in flip, has seen scores wrestle on conventional TV. CBS’ 10 p.m. programming contains “NCIS: Origins,” “FBI: Most Wanted,” “Elsbeth,” and “Blue Bloods,” which is in its 14th season.

Paramount International co-CEO George Cheeks, who runs CBS, advised Deadline in late 2022 that he was “committed to 10 p.m. and continuing our ratings success in that time period.”

Shell in the end backed off giving up 10 p.m. for NBC after weighing the potential fallout with Hollywood creatives and brokers, in keeping with individuals acquainted with the matter. Such a transfer at NBCUniversal would danger ruining relationships with TV titans equivalent to “Law & Order” creator Dick Wolf, whose exhibits have occupied the ten p.m. hour on NBC for years and have created a deep library for NBCUniversal’s flagship streaming service, Peacock. Irritating Hollywood would have run counter to Shell’s technique to extend Peacock’s content material catalog, as NBCUniversal wanted robust relationships to gasoline the service with new programming.

Wolf’s exhibits have been additionally important moneymakers for NBCUniversal, in keeping with an individual acquainted with the matter.

Ceding the ten p.m. hour would even have negatively affected the scores of NBC’s storied late evening present, “The Tonight Show.” CBS’ late evening present, “The Late Show With Stephen Colbert,” is constantly the top-rated late evening present, which might naturally give Shell pause on shifting away from 10 p.m. as soon as he is overseeing Paramount property.

Nonetheless, all the late evening exhibits are dropping viewers, and a downsizing has already begun throughout the style. Shell might really feel it is lastly time to drag the rip twine.

He’s clearly conscious that the established order of linear TV wants to alter.

“Obviously a big chunk of the company is in the linear world, and we know that linear is challenged and declining,” Shell stated through the July convention name. “I think a lot of us in the business know, we have got to run these businesses in a different way as they decline. And so, we’ve spent a lot of the last few months really building a bottom-up plan, and our goal is to manage the businesses, particularly the linear businesses, for cash flow generation.”

Shell can be prone to look at the content material windowing technique at Paramount, he stated in July. That might imply Shell has a want to tier Paramount+ in a different way, with some widespread content material obtainable on dearer tiers, maybe ad-free, that shift to inexpensive tiers, together with free ad-supported Pluto, over time.

“I’m a big believer in windowing strategy, and I think there’s maybe a more efficient way to maximize the value of our content, and we’ll continue to be in the DTC [direct-to-consumer] business,” Shell stated through the July convention name.

Some media analysts, equivalent to LightShed Companions’ Wealthy Greenfield, have argued Paramount International ought to shut down Paramount+ and as an alternative license Paramount content material to different streamers with extra scale. Paramount+ has constantly misplaced cash since its inception and will not be worthwhile till 2025, the corporate has beforehand stated.

That does not look like in Ellison and Shell’s playbook for Paramount. The 2 have expressed their want to companion Paramount+ with one other streamer so as to add scale and content material to the service, both by way of a merger or a bundle. Paramount International has already held talks with quite a few media corporations about partnering on streaming, together with NBCUniversal and Warner Bros. Discovery.

“To be a winner in [streaming] really means being in the ultimate bundle that’s coming,” Shell stated through the July convention name. “We’ve had a bunch of inbound calls from a number of people about partnerships that could involve a partnership with another player or players.”

At NBCUniversal, in keeping with individuals acquainted with his considering, Shell privately pushed the advantages of merging with one other content material firm — once more, one thing that by no means occurred.

He spoke up in conferences about the advantages of merging with Viacom, WarnerMedia and even Netflix to make sure Peacock would have endurance towards bigger streaming providers, in keeping with individuals who heard him communicate.

In the end, Comcast CEO Brian Roberts determined the strikes weren’t in the perfect curiosity of shareholders or that it was too troublesome to achieve regulatory approval for them, although Roberts practically authorized a deal in 2022 for NBCUniversal to merge with online game developer Digital Arts — a deal that, in keeping with individuals acquainted with the matter, would have seen Shell lose his job as NBCUniversal CEO. That position would have gone to EA CEO Andrew Wilson, the individuals stated.

With out a huge merger, Shell pushed for NBCUniversal to flood Peacock with content material, particularly through the peak of pandemic lockdowns, when Wall Road gave the impression to be closely valuing media corporations on their streaming subscriber numbers. He argued NBCUniversal ought to put most of its cable programming on Peacock, together with regional sports activities networks, or RSNs, in keeping with individuals acquainted with the matter.

Once more, different executives talked him out of being too aggressive, arguing the corporate’s present pay TV distribution relationships could be harmed if NBCUniversal made that content material obtainable exterior the cable bundle, in keeping with the individuals. Geolocation expertise points round regional sports activities additionally would have made the inclusion of RSNs troublesome, the individuals stated.

Whereas NBCUniversal has moved towards together with extra cable programming on Peacock, together with hit Bravo franchises equivalent to “The Real Housewives” and “Below Deck,” it has stored RSNs and information networks MSNBC and CNBC separate.

One in all Shell’s huge selections at Paramount will probably be what to do with a handful of cable channels which have successfully was zombie networks, largely airing reruns of the identical exhibits to keep away from spending on new content material. This contains MTV, VH1 and Comedy Central.

Shell needed to mix some NBCUniversal cable networks to chop prices and push again on dwindling income, individuals acquainted with the matter stated, however in the end determined to not.

Shell additionally had concepts that did not come to fruition about altering programming on a few of NBC’s cable networks. He initially needed CNBC to undertake what he described to others as a center-right primetime lineup, in keeping with individuals acquainted with the discussions on the time.

Then-CNBC chief Mark Hoffman argued the concept did not make sense for the community’s model and certain would not have a lot of an viewers, and Shell backed down, the individuals stated. CNBC did rent former Fox Information anchor Shepard Smith in 2020 to anchor a prime-time present that was canceled in 2022 simply months after Hoffman retired. Hoffman declined to remark for this story.

One in all Shell’s first accomplishments upon taking the NBCUniversal job was to resume the community’s “Sunday Night Football” take care of the NFL, and one of many final issues he did was help NBC Sports activities shifting ahead with a bid for NBA rights if it acquired a chance, in keeping with individuals acquainted with the matter. NBC did get the prospect to bid, and it is bringing again NBA video games starting in 2025 after agreeing to pay about $2.45 billion per season to the league.

Each Shell and Ellison touted the significance of CBS Sports activities throughout their July convention name. When Paramount laid off lots of of workers in September, none of them have been a part of CBS Sports activities, in keeping with an individual acquainted with the matter.

CBS owns a Sunday afternoon bundle of NFL video games, a part of NCAA March Insanity, Massive Ten soccer, UEFA Champions League, and The Masters, amongst different sports activities. It would not be stunning if Shell migrates away from CBS leisure programming towards sports activities, even in prime time, if these alternatives current themselves.

Disclosure: Comcast’s NBCUniversal is the dad or mum firm of CNBC.

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