In January, the board of Paramount, including Redstone, the company's chair, met with a group of bankers to get an update on the media industry and to hear about potential deals that might help the company better compete with streaming giants like Disney.
According to four people with knowledge of the meeting, the bankers from Goldman and LionTree came with many deal ideas. The bankers said that combining some parts of Paramount with those owned by NBCUniversal and the Peacock streaming service would be the most logical. There is a streaming joint venture between the two companies.
The board, led by Ms. Redstone and Bob Bakish, did not feel compelled to pursue any of the combinations. They would keep ziging.
With its collection of streaming services including Pluto TV and Showtime, Paramount would keep going it alone.
The rapid rise of streaming has changed the media industry in just a few years, as companies have felt pressure to spend billions on new TV shows and movies to attract enough subscribers to compete with the industry's giants. MGM was sold to Amazon. WarnerMedia is the film and TV giant behind the hit shows Game of Throne and Succession.
Not Paramount. Three years ago, the company was created from the merger of CBS and Viacom. The company has been trying to build its own profitable streaming business before the flow of cash from traditional TV runs dry.
Ms. Redstone and Mr. Bakish both said that Paramount would have success on its own.
Mr. Bakish said that people will continue to see that Paramount is.
Ms. Redstone and Mr. Bakish have to convince a lot of Wall Street. The value of the combined company has fallen since Ms. Redstone championed the effort to unite the two halves of her family's media empire. Wall Street valued the companies at $28.6 billion on the day the merger was announced. Paramount is now worth $22.1 billion, a 25 percent decline. The share prices of Paramount's competitors have declined as well.
LightShed Partners co-founder and analyst Rich Greenfield is skeptical that Paramount can survive on its own. Mr. Greenfield said that Paramount's streaming business is not profitable. The audience for Paramount's signature content has shifted to new-media platforms.
I don't think anyone will believe in five years that this company will buy other things or become part of a larger company.
Wall Street has become more focused on the profitability of streaming businesses. In April, the company said that it lost subscribers in the first quarter of the year, causing its stock to plunge. The revenue strategies Paramount has embraced for years, including advertising, are only now coming around to the importance of the competitors.
The box office is an example of a business that is largely ignored by streaming services.
Some experts think Paramount's strategy is sound. The global market for streaming subscribers is larger than the audience for pay-TV subscribers, according to an analyst for Goldman. In the first quarter, Paramount+ added 6.8 million subscribers. The majority of analysts have a buy on Paramount.
Not everyone pays for cable in the U.S., according to Mr. Feldman.
Paramount got a recent vote of confidence from the holding company run by Warren Buffet. According to a filing, the company has amassed a $2.6 billion stake in Paramount. The company declined to grant an interview to The Times, and did not explain its rationale for investing in Paramount. The news caused Paramount's shares to jump 15 percent.
Ms. Redstone was surprised by the investment in Paramount. Hours after it became public, she got the news.
I was out to dinner and the person asked me what I thought of Buffet's investment.
The fate of Paramount will most likely be determined by Ms. Redstone, who won a legal battle with Les Moonves to keep control of the entertainment assets her family had owned for decades. Ms. Redstone runs a company called National Amusements that owns voting stock in the company.
Mr. Redstone was known for his cantankerous and impulsive decisions, but he once threatened to sever Paramount's ties with Tom Cruise. She made a joke out of the contrast.
I said to my dad that everything I am is because of him.
In one-on-one conversations with Mr. Bakish, Ms. Redstone weighs in on the direction of the Paramount. She helped broker a deal with the South Korean entertainment firm of the same name by connecting Mr. Bakish to the vice chairwoman.
The decision to compete directly with major players like Disney and Netflix in direct-to-consumer streaming was an early supporter of Ms. Redstone.
In the aftermath of the merger, leaders at the company debated whether to invest in its existing subscription streaming service, or to forgo streaming for an arms dealer.
In early 2020, just weeks after the deal closed, Paramount decided to put some content from Viacom on CBS All Access, effectively bulking up the service without spending to produce original content.
After encouragement from Ms. Redstone, Paramount decided to spend money on original movies and TV shows for the service.
The company's network groups were asked to pitch projects for inclusion in a companywide subscription streaming service.
The company was done with its current course by July of that year. At a board meeting, company executives summarized the strategy, along with several possible names for the as-yet unnamed streaming service: Paramount+, Honeycomb, The Eye and Pluto+. The company's popular advertising-supported streaming service inspired the last option. They decided on Paramount+ over the summer, according to two people.
Paramount movies are released on Paramount+ within 45 days of their theatrical release. The idea behind that approach is that it gives Paramount a foothold in the emerging streaming era and one that is firmly planted in the traditional moneymaking ways of old Hollywood.
At the premiere of Top Gun: Maverick last month, Mr. Cruise paid homage to Sumner Redstone. Sumner Redstone would have been 99 years old on May 27th, and Mr. Cruise noted that the movie was being widely released that day. He died in 2020.
Ms. Redstone believed that her father would agree with her approach. She thinks that Wall Street will eventually come around if the company delivers on its promises.
The market keeps saying, "show me, show me," Ms. Redstone said.