The message for Paramount is clear: Not good enough.
In an interview with Variety on Thursday, Viacom CEO Bob Bakish said he was pleased with the 18 Oscar nominations that Paramount recently picked up for “Fences,” “Arrival,” and other critical favorites, while stressing that the film studio needs to become profitable.
“Paramount did well this quarter on the critically-acclaimed side, but we were disappointed on the financial side,” Bakish said.
Paramount, which has suffered a string of flops like “Ben-Hur” and “Teenage Mutant Ninja Turtles: Out of the Shadows,” had another rough fiscal quarter. Viacom reported that the film studio was mired in red ink during the most recent earnings period, posting an $180 million operating loss, down 23% year-over-year. Last year, Paramount was dead last among the six major studios in terms of market share.
The company’s rocky financial performance has led to speculation across the film industry that Brad Grey, who has served as Paramount’s chief for 12 years, might be forced out.
Bakish told Variety that he was working with Grey on a strategy that will see Paramount become more fully integrated with Viacom’s other brands. That group includes Nickelodeon, Nick Jr., MTV, BET, and Comedy Central. Under the new strategy, these cable properties will contribute one to two films a year to Paramount’s slate, while Paramount movies will inspire shows on their networks.
Bakish suggested, however, that Grey will be kept on a shorter leash.
“I fundamentally believe that leadership needs to be accountable,” said Bakish. “I’m accountable to the board. I expect the people that work for me to drive the company forward, I will hold them accountable for that. We are now turning the page on the strategy for Paramount. Now we are increasingly focused on execution.”
Viacom, which has been mired in a bruising leadership fight for over year, has had its own struggles. Shares of the company fell more than 40% over a two-year period, and former Chairman and CEO Philippe Dauman was ultimately forced out after engaging in a legal battle with Shari Redstone, daughter of founder Sumner Redstone. During that time, rumors abounded that Viacom might unload Paramount. Bakish suggested the new corporate strategy shows that the company is fully committed to the Hollywood studio and sees it as a critical component to its future growth.
“Ultimately this is a 180-degree swing from six months ago when people thought we were selling Paramount,” he told Variety, adding. “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. It should be a win-win strategy that should allow us to really talk about Paramount in a way that makes it a core part of the company.”
Viacom will now assemble a team of executives who will dual report to Paramount and the various cable networks that are responsible for developing properties that can move between TV and film, Bakish said. There are also ambitions to use these films and shows to create live events and consumer product lines. Bakish declined to say if these executives will be outside hires or if they will be promoted from within Viacom’s ranks.
Gone, however, are the days when a Comedy Central star or an MTV icon will develop a film pitch and see it released at a Paramount competitor.
“We are elevating our approach to content and talent, especially talent that can travel across platforms,” said Bakish. “We’ve had a lot of talent in the past that we’ve groomed and then let them off to do films elsewhere. We’re going to try to stop having that happen.”
Bakish’s support for Grey was measured, but he praised Paramount’s television and digital entertainment President Amy Powell for the work she’s done in building the studio’s small screen and online division up from scratch. The division is on its way toward profitability, he predicted.
“She’s doing a great job and there’s a lot more growth in that segment of the market,” said Bakish.
Cynthia Littleton contributed to this report.