WarnerMedia could cut thousands of jobs
Affected by the drop in theater attendance and the drop in advertising revenue, the owner of HBO and CNN is seeking to reduce its costs by 20%. This would be the second wave of layoffs in the group after the 500 job cuts already announced at Warner Bros.
Spectacular drop in cinema attendance, fall in advertising revenue, the health crisis is not affecting the entertainment industry. Faced with this constant, one of the largest companies in the sector, the WarnerMedia group, owner of HBO and CNN channels, and an AT&T subsidiary , will take drastic restructuring measures that could lead to thousands of jobs, the Wall Street Journal said Thursday.
According to the daily, which quotes anonymous sources , WarnerMedia should announce this restructuring in the coming weeks. It could affect thousands of jobs within Warner Bros Studios and HBO subscription or TNT cable channels, the newspaper believes. This is to reduce operating costs by up to 20%.
“Severe impact of the pandemic”
AT&T’s acquisition of Time Warner in 2018 exposed it to some of the uncertainty associated with running an entertainment business, notes the American daily. The company’s DirecTV satellite unit has lost millions of customers over the past two years. The pandemic is drying up revenues generated by movie theaters, television commercials and cable subscriptions. “Like the rest of the industry, we are not immune to the severe impact of the pandemic,” WarnerMedia said, adding that the group would seek in return for these restructurings to focus on other growth opportunities.
Thus, this would be the second wave of layoffs at the media group after the 500 job cuts already announced in August in the studios activity of Warner Bros. WarnerMedia employed nearly 30,000 people at the start of the year. Since taking control of this division in May, Jason Kilar, former Hulu boss has ousted many senior leaders from the unit and consolidated all production operations into one unit.
Other groups in the entertainment industry are struggling and are laying off due to the pandemic. The owner of Regal Cinemas, the second largest movie theater chain in the United States, has suspended its activities due to accumulated release delays. After promising to work “tirelessly” to avoid parting with anyone, Disney finally announced at the beginning of the month 28,000 job cuts in its theme parks.