• by Wayne Friedman , Staff Writer, August 9, 2024

A headline says: “Sony Says a Deal For Paramount ‘Does Not Fit Well With Our Strategy’” has strong reference to how things were in the media world some decades ago.  

The following story -- and the company -- did not offer specific reasoning, other than that it doesn't "fit well with our strategy," according to Hiroki Totoki, president, COO/CFO of Sony Pictures Entertainment.

But we can guess as much. That there are a lot of businesses that Sony doesn’t want to be in -- like large cable TV networks that desperately need to transition more into the streaming world.

The new owners of Paramount Global (Skydance Media) will need to figure this out now.

To an extent, it also probably wants to be more of what Sony Pictures Entertainment is now -- essentially what has been called an “arms dealer” of sorts -- a content-producing machine making TV shows and movies and then selling them to streaming, networks, theatrical movie houses and everything else in between.

This is what many analysts have essentially been saying about companies like Paramount Global and Warner Bros. Discovery:  That legacy media news has to pull back on these businesses, and/or shift more to being a major seller of content to what streaming, digital and other platforms need most: Premium movie and TV content.

Warner Bros. Discovery has been the first to recognize that much of its originally produced movie and TV series content should not be stuffed in its own streaming platforms -- especially Max, -- because consumers are only really focused on just a few TV shows (or movies)  at any given time.

That said, the new overall strategy is to give those consumers a sense there is still a lot of desirable content on those streaming services -- Max, Peacock, Paramount+, whatever. The reality is the consumer will only ever get to consume just a fraction of that content perhaps over the life of their subscriptions. 

Going back to Sony, business analysts were concerned decades ago that Sony Pictures Entertainment was lacking as a major media-based company. It did not own a broadcast TV network or a major cable TV entertainment network in the U.S.

Snarky business analysts who wondered how Sony could make a buck -- at least in the TV space -- especially as it concerns the lucrative advertising world. Well, Sony Pictures Television does sell advertising time in U.S syndicated shows, as well as on Game Show Network, and two free ad-supported streaming networks -- Game Show Central and Crunchyroll Channel, an anime platform. But these are somewhat limited operations. (Sony also does operate other global networks)

A clear picture would seem to be that Paramount Global would like to be more like Sony is now, with a focus on producing and selling content -- not having to drag around large legacy TV networks, figuring out how to transition that content and operations into the streaming world.

Still, we wonder, what would Sony Pictures Entertainment have looked like, if they had a major brand like CBS in its stable? New Paramount Global owners will be the ones needing to figure that out.