The CBS executive suite is the latest on the chopping block for big network television companies making cutbacks. CBS’s president and CEO George Cheeks recently dismissed CBS Entertainment president Kelly Kahl who company insiders believed “was going to be buried at CBS.” The prominent executive was a veteran of CBS after 26 years of service and still had quite a bit of time left on his contract. Kahl was let go alongside his top lieutenant Thom Sherman, who aided Kahl in running the broadcast network for five years. The two presided over a profitable time at CBS, with successful shows like Ghosts and FBI, as well as scheduling decisions that put the network ahead of NBC.

Watching such a successful person leave the CBS executive board makes people wonder why their parent company, Paramount Global, might be shuffling its leadership. David Nevins leaving Paramount Global is just another announcement that came this November. And many of these changes come hot on the heels of the New York attorney general’s decision that CBS and its former president Les Moonves (whom Kahl had followed into the company), would have to pay $30.5 million for a conspiracy to hide his sexual assault allegations from stockholders. Many other factors also play into this, but Kahl’s departure could be a sign of Paramount Global shifting its management tactics for the future.

Streaming Is Dominating Over Network TV

Streaming Services

It’s easy to say that in our modern age, streaming services are quickly replacing network TV. And it’s true. As the popularity of streaming channels grows beyond traditional cable and network TV providers, more and more businesses have decided to pivot toward that growing culture of streaming. As they do, one set of skills becomes more valuable as another gets outdated. This would be one explanation for why Kahl was forced out of the company. It’s simply a matter of skill sets.

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Kahl was known for his achievement of helping CBS overthrow NBC’s “Must-See TV,” which generally dominated program ratings on Thursday. He did it through an institutional knowledge of network television that helped him make clever scheduling and programming decisions to usurp the competing network. Once he was paired up with Thom Sherman, the two used their experience to keep CBS on top with reboots and spinoffs.

But this type of strategizing is no longer required in the streaming age. With services like Netflix and Paramount+, there is no need for scheduling decisions and programs competing for time slots. This is a world aimed more at seducing demographics and creating broad programming options instead of direct network competition. Removing Kahl represents a trimming of the executive fat, so to speak. Paramount Global saves money by removing a set of skills that might not be as valuable as they cost to keep. George Cheeks, president and CEO of CBS, said in a memo quoted by The Hollywood Reporter that this was “part of a restructuring and streamlining of leadership.”

Industry Changes and Cost Cutting

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Paramount Global

As one more executive drops from the Paramount Global leadership, much of the stated reasoning behind the change is that it is a cost-cutting measure. Quoted by The Hollywood Reporter, CEO of Paramount Global Bob Bakish stated in a Nov. 2nd earnings call:

“We have always been mindful of cost management as a company, and we are now taking additional steps to improve efficiency across our organization.”

Pushing Kelly Kahl and Thom Sherman out of the company is a way to make things cheaper and more efficient. People have said that Paramount Global’s list of executives has been too long for quite some time. When Nevins announced his departure, many observed that dividing his responsibilities among present executives was a good way to rationalize the company’s workflow.

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Of course, many see this as Cheeks making a move to improve CBS for his own reputation. Kahl and Sherman are two highly respected veteran executives at Paramount Global. While Sherman was offered a producing deal as a parting gift, Kahl was shoved out less than ceremoniously. This comes right after the announcement of the New York attorney general that CBS and Les Moonves will have to foot a $30.5m bill for insider trading around Moonves’ sexual assault allegations. Kahl followed Moonves into CBS when Moonves became president years ago.

Cheeks may see this as an opportunity to remove a tenured executive, saving costs at a time when CBS is feeling squeezed, and also shift the company’s strategy to a streaming-focused approach when perhaps not everyone is ready for the future.

Paramount Global is undoubtedly one of the biggest companies that has felt the reverberant change in the television industry. As streaming services become more popular, we would not be surprised if more network providers like NBC or ABC kept trimming parts of their companies that were more valuable in the '90s. Kelly Kahl leaving CBS is just another sign of a changing television landscape.