Walt Disney is reportedly planning a series of layoffs to cut spending. Especially for a wider budget throughout Walt Disney subsidiaries today.
According to news Thursday, the majority of cuts will be made on the ABC broadcast network, ABC News television production studio, and local television stations. Of the ten thousand employees, the Disney TV ABC group is likely to lay off 300 positions.
The deduction will also include a restructuring that represents ten percent of the company’s annual costs. Figures and details about budget scaling will be announced at the end of September, the date on which the group’s fiscal year will close.
ABC TV Group President Ben Sherwood expects Disney CEO Robert Iger to disclose details of the plan. There are possible details about the layoffs plan to be issued in the coming weeks.
It was considered as reviving rumors that Disney did not consider ABC as one of its best long-term parts. In fact, ABC recently made a major investment in talent and content including recruiting Katy Perry to become a jury of American Idol.
The news of the layoffs came after the Disney Channel, Freeform cable network, and ABC were all downsized.
The announcement of Disney to end the deal with Netflix and start their own streaming service have caused uncertainty among the NFLX investors. “No need to worry,” says Bernstein analyst Todd Juenger – and thus predicts the recovery of the stock.
The reasoning behind Jueng’s assessment: In the important international growth markets of Netflix, Disney content is already playing no role. Outside North America, only Netflix subscribers in two other markets had access to Disney films, in Australia and the Netherlands.
Although the exclusive agreement between Netflix and Disney entered into force only in 2016, the agreement was already signed in 2012. At that time Netflix was much smaller than today and only interested in the right for the US market.
According to this, there will be no major impact on the important international growth if, from 2019, no Disney films are to be found in the Netflix library. And in the US, the main focus now is on maintaining the high market penetration – rapid growth is no longer to be expected anyway. For the international business, the Bernstein analyst reaffirmed its forecast that the number of subscribers would more than quadruple to 220 million by 2030.