Welcome back to What I’m Hearing, coming at you from the WIH/postseason baseball HQ in Los Angeles. Between the spiking ratings for MLB playoffs, the Mets/Yankees/Dodgers vying for the World Series, hot take master Stephen A. Smith putting baseball on his “buy” list, and now Taylor and Travis showing up to cheer for Cleveland… I’m ready to declare America’s most boring sport actually cool again. (Temporarily? No? Not even a little?)

Anyway, tonight I’ve got a long-overdue update on the Paramount/Skydance transition, plus Scott Mendelson’s look at a surprising throttling at the box office… and more.

Programming note: I previewed Netflix earnings (and more) on CNBC’s Squawk Box this morning. On The Town, Lucas Shaw and I offered our latest Buys and Sells (sorry, John Krasinski) on the Hollywood Stock Exchange, and NRG analyst Fergus Navaratnam-Blair revealed the stars that young men actually care about. Subscribe here and here.

Got a news tip or an idea for me? Just reply to this email or message me anonymously on Signal at 310-804-3198.

Discussed in this issue: David Ellison, Wendy McMahon, Karen Bass, Tom Cruise, Ryan Reynolds, Kevin Mayer, Shari Redstone, Bryan Lourd, Chris McGurk, Jeff Shell, Amy Poehler, Josh Grode, Donna Langley, Taylor Sheridan, Hitman Bang, and… Barry Diller vs. Bianca Jagger.

But first…

Runner-up: Damien Leone, the Terrifier 3 director, whose killer clown generated an $18.9 million debut on a $2 million budget, nearly tripling week two of Joker: Folie à Deux and stomping awards hopefuls Piece by Piece, Saturday Night, and The Apprentice. (The latter may have set a record for the most earned media coverage that translated into the least amount of box office… if only Trump had attacked the movie the Monday before it opened!).

More on that ‘Terrifier’ shocker, below…

Runner-up: “I think I’m going to be ill.”
—Harrison Ford, legend, asked by GQ to comment on an “inspirational” shorts-and-sweater outfit he wore at the 1982 Cannes Film Festival.

Now for the latest at Paramount…

I’ve been hearing mostly cautious (okay… very cautious) positive reactions to the meet-and-greets and a few dozen or so “integration” sessions, which are part of the process for the overall Skydance-National Amusements-Paramount combination. That deal isn’t expected to close until next spring, but per the guidelines for such transactions, Shell has done one-on-one sit-downs with dozens of division heads across the company. And both Ellison and Shell, via these once- or twice-a-week meetings, are getting detailed business and strategy presentations from unit teams. Ellison has also been meeting with Paramount-affiliated talent like Tom Cruise, Taylor Sheridan, and the South Park guys (definitely not at the same time).

Ellison, not surprisingly, has been saying what people want to hear, per sources in the rooms. Investment. Opportunities. A clear vision, though he still hasn’t fully spelled out what exactly that vision will entail, probably because of those $2 billion in looming cost cuts that Skydance has promised. He’s being direct and transparent, I’m told, but he and Shell are also saying no personnel decisions will be made before the new year, even though I’m guessing that they’ve got an idea of who will be asked to fill out the key posts. They want to move fast once the deal closes, they say, and they’re projecting a more active involvement in day-to-day business, distinguishing themselves from current owner Shari Redstone and her mostly hands-off management.

On the Shari front, by the way, Ellison has been careful in recent meetings not to criticize her decision to publicly rebuke her own executives at a conference last week. If you don’t follow inside-baseball media micro-scandals, Redstone said, “I think they made a mistake here,” after McMahon rebuked CBS Mornings co-anchor Tony Dokoupil over his on-air exchange with Ta-Nehisi Coates about the history of the Israel-Palestine conflict. Paramount co-C.E.O. George Cheeks then put out a memo sort of rebuking Shari’s rebuking, saying he’s “incredibly proud of CBS News.” Ellison knows it’s bad form to publicly question executives, but it’s worse to poke Shari while the deal is open. (Reps for Skydance and Paramount declined to comment.)

Anyway, on more substantive business issues: It’s telling that Paramount’s direct-to-consumer divisions were among the first to present for the new leaders. According to three sources, Ellison is super-engaged on D.T.C., and while nothing is set in stone, he doesn’t seem too interested in selling or losing control of Paramount+, the subscription video platform, or Pluto TV, its free, ad-supported streamer. Pluto, in particular, has been “held back” and managed for profitability by the cash-strapped Paramount, instead of being operated as a growth asset. As a result, Ellison and Shell believe, rivals Tubi and Roku Channel are building their audience faster, as evidenced by Nielsen’s monthly Gauge report. Shell has been open about wanting to pursue bundles and/or joint ventures. “To be a winner in [streaming video] really means being in the ultimate bundle that’s coming,” he said this summer. But while it’s pretty clear Paramount will need to boost its distribution capabilities to match its content, if Amazon or Comcast see Par+ and its 71 million subscribers as an outright acquisition target, they may be disappointed.

Rather, the Skydance duo seems to see opportunity in content/tech investment and improvements to the windowing and licensing strategy. It’ll be tough to generate more short-term money from licensing—there’s next to nothing in the library that isn’t already farmed out to the highest bidder (albeit often nonexclusively so it can remain on Par+). And thanks to engagement-machine shows like NCIS and the Nickelodeon kid stuff, Paramount routinely leads all outside studios with content on Netflix in the “demand” metric, per Parrot Analytics.

But the new team has questioned the windowing strategy of, say, new Paramount movies, which go to Prime Video on a nonexclusive basis after a short period of exclusivity on Par+. Shell believes licensing nonexclusively to a massive platform like Prime Video is basically like offering an exclusive—i.e., everyone’s gonna watch it there. So he wants more exclusive windowing. He and Ellison also want Par+ and Pluto TV to share a common tech platform and to fully combine office space, which makes sense but will require investment, at least on the platform side.

And despite those promises of more money, the new leaders are looking closely at taking costs out of every division, particularly expenses that don’t translate into content or improvements to the tech platforms. They have communicated their understanding of how dire the linear situation is, especially as non-sports cable networks like MTV, VH1, and Comedy Central bleed subscribers—without quite explaining how they plan to deal with it. (I know… get in line behind every C.E.O. in Hollywood.) To that end, they’ve been supportive of the recent staff and cost reductions put in place by Cheeks and co-C.E.O.s Chris McCarthy and Brian Robbins—questioning only why these cuts, in divisions like marketing and communications, didn’t happen a while ago.

CNBC recently suggested Shell might revisit his old NBC ideas about scrapping 10 p.m. programming and giving the time to CBS affiliate stations. My sources haven’t heard that idea floated explicitly, and just like at NBC, this move would create a Dick Wolf Problem (he’s got FBI: Most Wanted in that slot and three lucrative shows at CBS). The “Dick Wolf Problem” used to be TV parlance for “I’m getting fired,” but maybe times have changed enough for Shell to make his move. Scrapping five hours of scripted shows would cut off a chunk of programming that also performs well on streaming and in international sales. It would also enrage the talent agencies, which might not be the smartest play as Ellison and Shell seek to add better projects to both the film and the non-Sheridan TV pipeline. But even Ari Emanuel and Bryan Lourd must admit what Shell means when he says CBS will be “managed for cash flow.” As I’ve written, the Tiffany Network is likely gonna start looking more like ABC and NBC—fewer and fewer scripted originals, and more sports, news, and reality/games in primetime.

To that end, it’s clear to those in the meetings that CBS Sports is a huge priority for Ellison and Shell. The future of linear equals sports, and Ellison is saying he wants to boost relationships with key leagues, like the NFL, with which Skydance already has a partnership. Bloomberg suggested Paramount could take over NFL Media and its NFL Channel, which the league has been shopping unsuccessfully for years. A change-of-control provision in its $2.1 billion annual rights deal with CBS could push Ellison and Shell to give the league more of what it wants.

How all of this impacts the top Paramount executives, especially the trio we are still not calling the Pep Boys, remains an open question. Cheeks, McCarthy, and Robbins all got fat contracts with lucrative change-of-control provisions when they were elevated to co-C.E.O.s during that wild period earlier this year when Redstone took Paramount off the table. So each is highly incentivized to stay until the closing. But they are all said to be actively plotting their next moves. Will McCarthy leverage the Taylor Sheridan relationship into a big job post-merger? Could Cheeks move back to NBCUniversal under the newly promoted Donna Langley? Might Robbins, who is said to be the least cheerleader-y toward Skydance in meetings, look to raise his own money for a post-Paramount venture? Only rumors, at this point.

What is Legendary Entertainment, the Dune and Godzilla studio, worth to an acquirer? C.E.O. Josh Grode certainly appears interested in finding out after finally buying out Wanda’s stake. [Bloomberg]

FilmLA is officially begging for better California production incentives. The real mystery is why L.A. Mayor Karen Bass continues to sit this out as the local entertainment economy implodes. [LA Times]

Hitman Bang—a.k.a. Bang Si-hyuk, a.k.a. the billionaire King of K-pop—finally gets the New Yorker treatment. [New Yorker]

In honor of Saturday Night, Alan Siegel rewatched the first SNL episode. I’d totally forgotten about “Show us your guns.” [Ringer]

Beachbody, the fitness company that merged with a SPAC affiliated with Disney-turned-Candle Media execs Kevin Mayer and Tom Staggs, is laying off 200 employees and “abandoning” its business model. Yikes. [LA Business Journal]

Barry Diller’s bizarre media tour continues with a mini-feud over whether he actually witnessed Bianca Jagger enter Studio 54 on a white horse: “Her recollection varies from mine.” [Financial Times]

Now, Scott Mendelson is here with the takeaway from a scary-great weekend for ‘Terrifier 3’…

In fact, by the time you read this, Damien Leone’s Terrifier 3 will have earned around double the lifetime domestic total of its predecessor. The slasher sequel, released by Cineverse, cost $2 million (plus another $500,000 for marketing) and opened with $18.9 million during its Friday-Sunday domestic debut. By the end of its Friday-Monday holiday launch, it will likely have earned around $22 million—a massive upswing from its predecessor’s surprisingly ample $10.9 million box office total. The success of this unrated splatter series is nearly unprecedented in horror history, going from a mostly V.O.D. indie flick to a modest theatrical hit to a full-on mainstream breakout. Credit Cineverse, overseen by Chris McGurk, which turned the threequel into a massive event for existing fans—and a glorified FOMO moment for anyone willing to endure the carnage.

So yes, whether it’s Late Night With the Devil and Immaculate setting small-scale box office records for IFC Films and Neon, or the latest murder mime adventure pulling mainstream grosses, horror still sells, even if…

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“Rather than giving Todd Phillips carte blanche, he should have been sent back to make the script work in the first place. The politics of being filmmaker-friendly and wanting a showy announcement looks good on paper, but I bet there is a lot of internal hindsight at Warner Bros. of why they approved the script in the first place. I love Pam [Abdy] and Mike [De Luca]. I also understand their risk tolerance given the pressure WBD is under. But just giving money to A-list directors for name value (Ryan Coogler [with a full freight Michael B. Jordan]; Iñárritu with a full freight Tom Cruise; P.T.A.’s “commercial movie” with a full freight Leo) isn’t risk mitigation unless the price point is right, as you said. These three movies are at least a cumulative half a billion dollars with P&A. They crowd out taking chances on newer directors with fresh ideas that could turn into franchises.” —A producer

“Adding to your Nolan knife twist: Nolan still much prefers the WB mixing stages, so even though he’s staying at Universal, it’s almost guaranteed he’ll be strutting around the [Warners] lot while working on a Universal picture. I don’t blame him, though—the techs on Stage 10 are the best.” —A filmmaker

“What’s rarely spoken of are the technical limitations Netflix puts on filmmakers in terms of cameras, lenses, framing, composition, etcetera. Taking that big check isn’t just a distribution sacrifice but a creative one. Every Netflix movie is technically optimized for the small streaming screen, unless your name is Scorsese or Fincher. I wish this would be highlighted more in conversations about Netflix bidding for talent. That ‘Netflix look’— which often looks like TV, even when shown in a theater—isn’t an accident but by design, and it cramps a director’s vision.” —A writer-producer

“That is a terrible idea for the Oscars hosting situation. If a ‘host’ doesn’t do the full traditional job, they’ll be blamed and skewered for phoning it in. Who would sign up for that? Just pony up and pay for real talent.” —A lawyer

“Oscars Alternative Telecast: Kimmel and Crystal instead of Peyton and Eli… except Belichick still shows up.” —A professor

Got a question, comment, complaint, or a Game 3 starting pitcher? Email me at Matt@puck.news or call/text me at 310-804-3198.