Disney Considers 10% Cost Cuts in ABC TV Unit, Source SaysBy
Walt Disney Co., under pressure to improve profit at its TV business, is considering cost cuts of as much as 10 percent at its Disney/ABC Television Group, according to a person familiar with the plans.
The moves could include job reductions, although no final decisions have been made, according to the person, who asked not be identified because the discussions are private.
Disney’s networks, the source of almost half the company’s profit in fiscal 2016, have lost viewers and subscribers to online options such as Netflix Inc., YouTube and Snap Inc. In the most recent TV season, ABC finished last among the big four broadcast networks with the 18-to-49-year-old demographic group favored by advertisers. Ratings fell about 11 percent from a year earlier, according to Nielsen data.
The division includes Disney’s kids channels and the ABC broadcast network, not its ESPN sports business, which has undertaken similar cuts in recent years. The Wall Street Journal reported earlier Wednesday that the TV group’s president, Ben Sherwood, is expected to present a plan for cuts to Disney Chief Executive Officer Bob Iger in the coming weeks. The proposal could include firing as many as 300 of the unit’s 10,000 employees, the newspaper said.
Disney said on Aug. 8 it would introduce its own video-streaming service featuring shows and movies for children in 2019. The company plans to stop supplying family films to Netflix as part of that move. A week later, Netflix announced it signed a deal with Shonda Rhimes, a top producer for the ABC network.