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ABC News to Trim Budget
The ABC television network's news division plans to trim its budget by $15 million to $20 million, a source said, in the latest example of cost-cutting at media companies due to a softening advertising market.
General Electric Co.'s NBC network, NBC Internet Inc., News Corp.'s (NCP.AX) digital unit and AOL Time Warner Inc.'s CNN unit have all slashed their workforces in the last month, with all but CNN citing the weaker advertising market as the impetus.
A spokesman with ABC News, which is part of Walt Disney Co., declined to comment. But a source familiar with the network said the cutback represented about 1 percent to 2 percent of the news division's annual budget.
"ABC News isn't planning any wholesale layoffs,'' he said, ''but there could be as many as 15 correspondents whose contracts will not be renewed.''
Higher-profile anchors like Peter Jennings and Diane Sawyer have multiyear contracts and would not be affected. The source also confirmed that "World News Tonight'' and ``Weekend'' news operations would be combined, and a hiring freeze was in place.
ABCNews.com, the news Web site that is part of the WaltDisney Internet Group , is not currently planning any job cuts, a spokeswoman said.
"We are investigating what aspects of ABCNews.com best fits our users demands,'' she said. "As we have all along, we will concentrate on restructuring the site in a way that answers those needs.''
Earlier this month, News Corp. eliminated 200 jobs from U.S. Internet news unit and rolled the unit into the operations of the Fox television network. Similarly, CNN combined its Web sites with its television properties.
"That's something that ABCNews.com has done all along,'' the spokeswoman said. ``We've always worked very closely with the television news division.''
The Web site does, however, have a separate staff, separate budget and separate leadership.
Disney Internet Group, which trades as a separate tracking stock from Walt Disney Co., also has no plans to cut staff, ''although we are evaluating every part of our business,'' she said.
The overall ABC television network is not planning any across-the-board layoffs, but senior executives throughout the network have been given more stringent budgetary goals, which could lead to layoffs in different departments.
"The network has not mandated any layoffs,'' an ABC spokeswoman said. "But the department heads have been directed to meet certain goals. How they get to those goals is up to them. Layoffs are one option, but they could also cut travel, advertising or other budgets.''
Last year, media companies were flush with money coming in from aggressive campaigns by dot-com companies, many of which have failed over the course of the year. The prospect of a weaker overall economy has put pressure on advertising budgets of established companies as well.
Disney shares closed off 7/16 to $32-11/16 on the New York Stock Exchange on Friday. Disney Internet closed down 3/16 to $5-5/16. (Agencies)
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