Channel 4 to cut 200 jobs
Channel 4 is to cut a total of 200 jobs – a third more than it first planned – in an effort to save several million pounds more in costs as the outlook for next year’s advertising market worsens.
The broadcaster today confirmed that a total of about 200 posts would be axed across its different divisions, including commissioning, new media and marketing, up from its original estimate of 150.
These cuts, which are expected to be mainly completed by the end of this week, will comprise of 100 voluntary redundancies, 50 compulsory redundancies and the closure of a number of vacant posts as well as the broadcaster’s 4Radio division and digital sales house 4DS.
No further senior executives are expected to leave in the current cost-cutting process, although a source said a number of outstanding staffing issues could see more departures in the second quarter of next year.
Among those who have left or are known to be leaving are marketing director Polly Cochrane, comedy commissioning editor Caroline Leddy and head of legal Jan Tomalin.
Channel 4 will enter the new year with fewer than 800 employees – its lowest head count since 1998, before it began its digital expansion with the launch of services such as Film4 and E4.
The broadcaster has estimated that its commercial revenues will fall between 5% and 10% next year and has warned that a further £25m will be cut from its £575m annual programme budget.
A Channel 4 spokesman said: “We are doing this because we think this is prudent management. We have taken more voluntary redundancies than we originally expected in order to minimise the number of compulsory redundancies. We have gone further than the original cuts because it is a prudent measure given the uncertainty of the advertising market next year. We feel we have now done as much as possible for Channel 4 in terms of self-help.”
Because of falling ad revenues and structural change in the broadcasting sector due to the rise of digital media, Channel 4 has said it expects to have an annual funding gap of £150m by 2012.
Ofcom and the government are currently looking at a range of funding options for the broadcaster, including a potential tie-up with BBC Worldwide.
The Financial Times reported today that one idea under consideration would involve Channel 4 pumping £500m into a new joint venture with the BBC’s commercial arm, with BBC Worldwide putting its 50% stake in the UKTV programming operation and its 2 Entertain DVD distribution partnership with Woolworths into the business. BBC Worldwide is in the process of taking full control of 2 Entertain from the stricken high-street retailer.
It is understood that the proposal is being examined by the investment banks that have been drafted in to advise Channel 4 and the BBC on future funding options.
Channel 4 has hired the services of NM Rothschild to assess potential funding solutions, while the Department for Culture, Media and Sport is being advised by investment bank UBS. Meanwhile, the BBC has signed up Goldman Sachs to advise on the future of BBC Worldwide.
One source said: “Channel 4 doesn’t want the BBC to hand over BBC Worldwide in its entirety. The BBC has got to be incentivised to partner with Channel 4 rather than forced to transfer value.”
From Guardian
