“South Park” creators Trey Parker and Matt Stone scored two blockbuster deals that will pay their production company at least $2 billion over five years — ranking their pacts among the richest in television history.
Paramount Global secured the show’s exclusive global streaming rights for $300 million a year, bringing Kenny, Kyle, Stan and Cartman to the company’s digital service, Paramount+, for the first time in the U.S. About half of that sum will go to the “South Park” creators through a joint venture they co-own with Paramount.
Paramount separately extended Stone and Parker’s overall production deal for their firm, Park County. As part of that pact, Park County will receive a minimum of $250 million a year through 2030 to make at least 50 new “South Park” episodes, according to two people familiar with the deal but not authorized to speak publicly.
The gravity-defying deals prove that even as Hollywood studios struggle financially, they are willing to pay big bucks to proven hitmakers.
“In a business where nobody knows anything, there is one certainty: ‘South Park’ always wins,” said former Comedy Central chief Doug Herzog, who brought the cartoon to television nearly three decades ago. “Shows like ‘South Park’ are at the heart of what builds the value in companies like Paramount.”
The agreements came together Monday after months of tough-knuckled negotiations that revealed disagreements within Paramount as the company prepares to be sold. For months, Paramount managers labored to negotiate new contracts with Stone and Parker. Then, the company’s prospective buyer, David Ellison’s Skydance Media, stepped in and hit pause.
Squabbling over “South Park” became the latest headache for the son of tech billionaire Larry Ellison, who is in the final stretch of his nearly two-year quest to buy the media company that owns CBS, Nickelodeon, MTV and the venerable Paramount Pictures movie studio. The $8-billion merger with Paramount is expected to be complete in the coming weeks.
All sides were motivated to reach a deal before Wednesday, when Paramount’s Comedy Central kicks off the 27th season of “South Park.” Earlier this month, after one premiere date got pushed, Paramount Co-Chief Executive Chris McCarthy cemented this week’s debut in an effort to establish a dealmaking deadline.
Paramount and Skydance also wanted to get the negotiations wrapped up before Stone and Parker speak to fans at San Diego Comic-Con later this week.
For weeks, a debate raged behind the scenes: How much was too much for “South Park?”
The foulmouthed cartoon ranks among the top 20 streaming shows so far this year, according to Nielsen, a lofty achievement for a program that debuted in 1997.
Initially, Park County, represented by Parker and Stone’s longtime lawyer Kevin Morris, demanded a 10-year deal that would have delivered a much greater payout.
The creators wielded enormous leverage given their track record.
But Skydance was wary of approving a deal that could potentially create huge losses over the next decade, according to knowledgeable sources. Skydance and its backer RedBird Capital Partners have promised investors belt-tightening to bolster Paramount’s strained finances and raise its damaged credit rating.
Skydance and RedBird have told analysts they expect to find $2 billion in cuts.
Tensions over the deal terms put Paramount’s current managers at odds with Skydance.
Paramount executives advocated for Stone and Parker as trusted collaborators, making the case that “South Park” drives value for the company, according to numerous people close to the negotiations.
McCarthy told investors in May that the show was coming to Paramount+ soon, though a new deal had not been forged
Paramount was eager to bring “South Park” to Paramount+ because it has been available exclusively on rival HBO Max in the U.S. for the last five years. Paramount’s strategy in recent years has been to build its channels and platforms around big properties, including Taylor Sheridan’s “Yellowstone” franchise and the recent return of Showtime’s killer “Dexter.”
The HBO Max deal expired in late June.
Disagreements burst into the open when “South Park” lawyers took aim at Skydance, alleging Ellison and RedBird senior executive Jeff Shell overstepped their bounds in the negotiations, which jeopardized the value of the show and Park County’s collaborative relations with Paramount.
Skydance, which does not yet own Paramount, maintained that it has a contractual right to approve major transactions as it waits for the keys.
Park County enlisted bulldog litigators Stuart Liner and Bryan Freedman to prepare a lawsuit targeting Paramount and Skydance over the latter’s heavy involvement. Such a high-profile legal battle would have risked a costly public relations snafu at an inopportune time as Ellison seeks the Federal Communications Commission’s approval for his Paramount takeover.
By last weekend, the two sides reached a breakthrough and the tenor of discussions turned more fruitful. The lawsuit threat was dropped.
Negotiations to co-license “South Park” to HBO Max as well as Paramount+ collapsed on Monday, leaving Paramount to claim the exclusive streaming rights. At one point, Netflix had also expressed interest in the property.
The “South Park” skirmish tested Ellison’s handling of high-profile talent, offering a glimpse into his style and programming priorities as he prepares to lead Paramount as its CEO.
Ellison has said he wants to rebuild the company by forging collaborative relationships with talent. He told analysts last year that the plan was to make the Paramount studio “the first stop for best-in-class storytellers.”
Park County also maintains a lucrative agreement fashioned in 2007, before streaming became the dominant medium. That arrangement gives Park County expansive rights over digital distribution and a nearly 50% ownership stake in the production company South Park Digital Studios.
Paramount controls the digital venture. It shares the streaming licensing revenue — in this case, $300 million a year — with Park County.
One sticking point in the talks was the “South Park” team’s insistence on simultaneously renegotiating all of the contracts.
Skydance pushed back, arguing that Park County’s existing overall deal — a $900-million arrangement signed in 2021 — was not set to expire until 2027. Skydance wanted to delay that battle until after it took control of Paramount, according to four knowledgeable people.
In the end, Skydance ceded ground. The new deal guarantees Park County $1.25 billion over five years.
Park County Chief Executive Keith Pizzi, who led the negotiations with Morris, called the new arrangement “an unprecedented deal for artists.”
“Matt and Trey’s partnership with Paramount has helped change TV and this deal means ‘South Park’ will be here to help redefine whatever comes next,” Pizzi said in a statement. “We’re psyched for five more years with our fans.”
Paramount is betting its future on streaming and it gambled that “South Park” episodes will strengthen the Paramount+ service.
The seeds of “South Park” were planted when college buddies Parker and Stone created a crudely animated short film called “The Spirit of Christmas,” made with paper cutouts, which took the country by storm on home video and became an early viral sensation.
That ballooned into a biting satirical series that put Comedy Central on the map (along with “The Daily Show”) and made Parker and Stone rich, with their merciless skewering of celebrity culture and politics.
Comedy Central paid Park County $12,500 an episode for the show in its inaugural season.
Parker and Stone have since branched out, creating the Tony-winning Broadway musical “The Book of Mormon” and, more recently, buying the Lakewood, Colo., themed Mexican restaurant Casa Bonita, the inspiration for a classic “South Park” episode.
“If you’re going to be in the creative business, in show business, it’s always about the talent,” Herzog said. “Whether it is Matt and Trey or Jon Stewart or Stephen Colbert, these guys are incredible talents and they don’t grow on trees.
“That’s worth something, and in the case of ‘South Park,’ that’s worth a lot,” he said.
Times staff writer Matt Hamilton contributed to this report.
