David Ellison Has Gamed Out His California Exit: Skydance Media CEO Weighs Full or Partial Relocation Amid Soaring Operational Costs
Key keywords: David Ellison, Skydance Media, California exit, Hollywood relocation, Texas media industry incentives, California state tax policy, entertainment industry exodus, cross-state business relocation
Multiple sources close to Skydance Media confirmed this week that CEO David Ellison has spent the past six months mapping out a formal exit plan for his billion-dollar production company from its longstanding Santa Monica, California headquarters, with Texas and Tennessee emerging as the top two candidate destinations for relocation. Ellison, whose studio has produced global blockbusters including *Top Gun: Maverick*, *Mission: Impossible – Dead Reckoning Part One*, and multiple entries in the *Terminator* franchise, has repeatedly voiced frustration to senior leadership over California’s rising operational expenses, competitive and limited tax incentive pools for film and TV production, and sky-high cost of living that has made it difficult to retain entry and mid-level creative staff.
Internal documents reviewed by industry outlets show that a full relocation of Skydance’s 400+ person workforce to Austin, Texas would cut the company’s annual operating costs by an estimated 42%, including savings on commercial real estate, state corporate taxes, and production labor expenses. Ellison’s team has already held three formal meetings with Texas economic development officials, who have offered a $37 million multi-year tax credit package if Skydance meets specific job creation and capital investment targets over its first five years operating in the state. A secondary option being considered would keep a small 40-person executive and administrative team in California, while moving all core production, post-production, and creative development teams out of state by the end of 2025.
Ellison’s planned exit comes amid a broader exodus of entertainment and tech companies from California over the past decade, with Tesla, Oracle, and dozens of mid-sized production studios already relocating headquarters or core operations to states with lower tax burdens and more business-friendly regulatory environments. A 2024 survey of Hollywood production executives found that 68% of respondents are actively weighing partial or full relocation of their teams outside of California, citing the state’s 13.3% top individual income tax rate, 8.84% corporate tax rate, and long wait times for film tax credit approvals as the top three driving factors. Early internal surveys of Skydance staff found that 62% of non-executive employees would support a move to Texas or Tennessee, noting that the lack of state income tax in both states would boost their take-home pay by an average of 18% even without salary adjustments, while residential housing costs are 50% to 60% lower than in Los Angeles County.
Featured Comments
As a Hollywood industry analyst with 17 years of experience, David Ellison’s planned exit is the clearest warning sign yet that California is at risk of losing its status as the global entertainment capital. Lawmakers have spent years ignoring complaints from small and mid-sized studios about the state’s uncompetitive tax incentives, and losing a respected, high-growth company like Skydance will force them to finally update these policies before more jobs leave the state.
I’ve worked as a VFX artist on three Skydance productions over the past two years, and I’m already browsing apartment listings in Austin. I make $115,000 a year, but after paying $2,800 a month for a 1-bedroom apartment in Los Angeles and state taxes, I can barely save anything. This relocation would be a massive win for most junior and mid-level staff who have been priced out of California for years.
As a policy advisor for the California governor’s office, we are deeply disappointed to see Skydance weighing an exit, and Ellison’s public confirmation of his plan is a wake-up call. We are already drafting revisions to our state film and media tax incentive program to make it more accessible to growing studios, and we hope to present a competitive offer to keep Skydance in the state before a final decision is made.
Texas has spent 10 years building out its entertainment infrastructure, from sound stages to post-production facilities to local creative talent pipelines, and landing Skydance would cement Austin as the leading alternative to Hollywood for media companies. The combination of no state income tax, lower production costs, and far less bureaucratic red tape makes the move an obvious choice for any studio tired of California’s dysfunction.