If Paramount Needs to Sell Networks, Who Would Buy?

Paramount's efforts to sell some of its cable networks in order to settle an antitrust case may prove challenging due to the deteriorating fundamentals of the cable industry. With cord-cutting and a decline in advertising and distribution revenues, cable networks are becoming increasingly undesirable. Private equity firms and local broadcast TV station owners are the most likely buyers, as they can leverage the networks' cash flow for short-term profits.

However, the cable network ad revenues have been falling at a rate of 10% so far this year, while carriage fee revenues have dropped by 3%. Additionally, pay-TV subscriptions are down to about 60 million, with streaming MVPDs like YouTube TV gaining ground. This downward trend may make it difficult for Paramount to find a buyer for its cable networks.