×
You will be redirected back to your article in seconds

As Brad Grey Exits, Viacom Explores Possibilities for Paramount

Brad Grey might have looked forward to this Sunday as a chance to take to the Oscar red carpet with a little extra bounce in his step. And why not? The chairman and CEO of Paramount Pictures had led his studio to 18 Oscar nominations, including best picture nods for the sci-fi brain-twister “Arrival” and the Denzel Washington drama “Fences.”

But Hollywood’s night of nights promises to be a somber one for Grey, coming just days after his ouster from the job he held for nearly a dozen years. Through it all, Grey exhibited as much resilience as the Transformers Paramount so frequently put on the screen. Even the studio chief’s critics marveled at his ability to shake off corporate infighting and costly film flops while keeping his throne. The red ink continues to build: The studio had an operating loss of $457 million in fiscal 2016.

But last week Grey, whose contract was due to expire in 2020, ran out of ways to charm his corporate masters. Despite the awards attention, Paramount has endured a steady stream of flops, exacerbated by an aging set of franchises and a shrinking slate of films. Under Grey, Paramount did hit it big with “Mission: Impossible” and “Transformers” sequels, and the studio chief recently inked a $1 billion slate financing deal with the Shanghai Film Group and Huahua Media. However, his taste in projects was questionable, with Paramount backing stinkers like “Zoolander 2,” “Whisky Tango Foxtrot,” and “Allied” and failing to field the sort of super-hero smashes and animated blockbusters that have propped up its competitors. Paramount finished behind all of the five other major Hollywood studios in each of the last five calendar years, even slipping behind Lionsgate at points.

In 2016, “Star Trek Beyond” was the only Paramount film to take in more than $100 million domestically. The bleeding got so bad that the studio took a $115 million write-down in advance of the release of “Monster Trucks,” which, indeed, flopped when it opened in January. Drexel Hamilton analyst Tony Wible pegged the losses for the year at $500 million “despite a favorable box office, home entertainment, and licensing environment.”

Bob Bakish, chairman and CEO of Paramount’s parent, Viacom, will visit the Melrose Avenue studio on Feb. 21, where he is expected to discuss a management shift with Paramount employees. Whoever steps into Grey’s shoes will face a herculean task. Turning around a studio takes three to four years, and Paramount has lost its reputation for being talent-friendly during its period in the box office doldrums. It needs to reestablish itself as a destination for top directors and writers to pitch their projects, instead of the studio of last resort.

Grey with Philippe Dauman, who was ousted as Viacom chairman-CEO in September.
Dave Allocca/StarPix/REX/Shutterstock

Bakish unveiled a plan this month that would see Paramount strengthening its ties to Viacom’s cable brands, with the likes of MTV and Comedy Central contributing one or two film projects a year, and the film studio creating movies that could be turned into shows on those networks. The only problem is that Viacom has flirted with a similar strategy in the past, with MTV and Nickelodeon offering up “Jackass” and “SpongeBob” movies. That didn’t prevent the studio from sliding to the bottom.

“They definitely need to make more movies, and they need to be more bold in the movies that they make,” says a producer who works frequently with Paramount. “If you are going to make noise in the marketplace, you are going to have to be somewhat original.”

Then there are financial restrictions. Viacom is carrying nearly $12 billion in debt. It’s unclear how much financial flexibility Paramount will have to bid on the best projects or to sign lucrative talent deals given that its corporate parent is so heavily leveraged.

“Whoever replaces Grey will have to manage the funds available shrewdly and place bets with lots of thought,” says Hal Vogel, a media analyst.

It’s not clear that there’s still a place for Paramount. The domestic box office is stagnant, and the home entertainment market is a shell of its former self, brought low by the collapse of the DVD business. With revenue shrinking, the industry has become positively Darwinian.

“A case could be made that maybe six major studios is one too many, and there ought to be another round of consolidation,” Vogel says.

Despite Paramount’s murky future, there’s rampant speculation about who might replace Grey. Former 20th Century Fox chairman Jim Gianopulos has surfaced in discussions about every significant opening in Hollywood in recent months. However, Gianopulos is currently negotiating a deal to run Legendary Entertainment. Former Warner Bros. president Jeff Robinov, currently bridling under his production deal at Sony, has expressed interest in the Paramount role, but there’s no indication of how his entreaties have been received.

Some close to the company say Bakish might not announce a permanent replacement, instead turning to a management committee to run the studio’s various divisions. The Viacom boss has spoken highly of Amy Powell, president of Paramount’s television and digital entertainment unit. Recently arrived COO Andrew Gumpert (previously at Sony Pictures Entertainment) and former HBO programming chief Michael Lombardo are among others who might take more prominent roles in Paramount’s next iteration, insiders say.

Beyond Powell and Gumpert, Paramount doesn’t have a very deep bench. Under Grey, the studio regularly rotated through executives, making the Hollywood lot akin to the island in “Survivor.” One of the last to get voted off was vice chairman Rob Moore, who was ousted in September. The year before, studio president Adam Goodman lost his job. Critics complained that the executive revolving door never reached as high as Grey, the man ultimately in charge.

“There were an amazing number of people who lost their jobs there, from the highest level to the lowest level,” says one former executive, who asked not to be named. “You had so many people let go as a result of the management of the company. That is why many people have been waiting for him to get his just deserts.”

While he laid out his vision for a more integrated Viacom universe in early February, Bakish made it clear that the conglomerate’s film studio had been underperforming. “It’s an incredible opportunity for the media networks to extend the reach of their brands in the theatrical space and an incredible opportunity for the studio in this market of competition to develop great ideas and great talent,” he said.

The CEO argued in that interview that he was running out of patience with his stumbling film studio. “I fundamentally believe that leadership needs to be accountable,” said Bakish. “We are now turning the page on the strategy for Paramount. Now we are increasingly focused on execution.”

The studio’s silver lining came in creative recognition for not only “Arrival” and “Fences,” but for Meryl Streep’s turn as tone-deaf opera star “Florence Foster Jenkins.” Instead of basking in the glow of Oscar night, Grey has been held to account. It will fall to someone else to execute Bakish’s vision.

More Film

  • Vice Christian Bale Sam Rockwell Playback

    'Vice' Reviews: What the Critics Are Saying

    Reviews are in for Adam McKay’s Dick Cheney biopic, and it’s not all awards-season buzz. Despite garnering six nominations for this year’s Golden Globes, McKay’s kitschy approach to the politically charged film has polarized reviewers, prompting a mix of scathing critiques and celebratory praise for the director’s distinct film style. What critics can agree on, however, [...]

  • Lena Waithe Brian Tyree Henry

    Lena Waithe, Brian Tyree Henry to Present $125k in Annual Film Independent Grants

    Writer-creator Lena Waithe and actor Brian Tyree Henry will present a quarter of a million dollars in filmmaker grants come January as hosts of the annual Independent Spirit Awards nominee brunch. Waithe, this year’s Spirit Awards honorary chair, and Henry will dole out the prizes in four categories, including a $50,000 unrestricted grant for a [...]

  • Piero Tosi Luchino Visconti

    How Costume Designer Piero Tosi Dressed Up Cinema

    One of international cinema’s undisputed greats in costume design, Piero Tosi’s work first faced the awards season spotlight 64 years ago with only his third film, Luchino Visconti’s masterwork “Senso,” which competed for the Golden Lion in Venice in 1954. Nominated for five Oscars for costume design and recipient of an honorary Oscar in 2013, [...]

  • RYAN GOSLING as Neil Armstrong in

    Big Breakthroughs Seen in Below-the-Line Categories

    Is 2018 an anomaly, or is it a harbinger of things to come? The awards derbies of recent years have seen a predominance of indie films at the expense of big studio features — resulting in a slate of Oscar contenders devoid not only of genuine blockbusters but also of more modest mid-budget crowd-pleasers. This [...]

  • Fox Germany Veteran Vincent De La

    Fox Germany Veteran Vincent De La Tour Heading to Paramount Pictures

    20th Century Fox veteran Vincent de la Tour is joining Paramount Pictures in a role covering Austria, Germany and Switzerland. He will be executive vice president for theatrical and home media for those territories, overseeing the local teams and reporting to Cameron Saunders, Paramount’s EVP of international theatrical distribution, and Bob Buchi, president of worldwide [...]

  • Editorial use only. No book cover

    It's Time to Enjoy the Movies and Ignore the Oscar Noise

    For most of its 91 years, Oscar has been surrounded by hoopla. Now it’s surrounded by noise, which isn’t the same thing. For decades, the Academy of Motion Picture Arts & Sciences’ attitude toward the media was: “Don’t talk about the organization; instead, talk about the creative members and their movies.” But in the internet [...]

  • Crazy Rich Asians

    Diverse Lineup of Actors Jostle for Awards Attention

    It’s been less than four years since #OscarsSoWhite became a hot topic at the Academy Awards after 2015 films like “Creed” and “Straight Outta Compton” failed to land major nominations for people of color. (It actually began the year before but picked up steam when, for the second year in a row, no people of [...]

More From Our Brands

Access exclusive content