Stop me if you’ve seen this horror show a few times already: major Hollywood studio eliminates a tranche of film and TV jobs, in areas such as distribution and marketing, and declares itself “streaming first.”
The latest episode in what’s becoming a long-running Hollywood series is a “bloodbath” of layoffs hitting Disney’s General Entertainment Content and Walt Disney Television divisions, as well as at National Geographic. Several senior executives were among the 100 or so sent out the door, largely from such usual targets as publicity, marketing, scheduling and media planning.
The layoffs came days after Hulu’s Head of Originals, Craig Erwich, took over at ABC, too. That was seen as yet another signal of Disney’s “streaming first” intentions. Elsewhere, what had been Touchstone Television (nee Fox 21) was folded into 20th Television, with yet another long-time executive sent “back to producing.”
And indeed, it was telling that among layoffs were the formerly dedicated teams handling scheduling for broadcast network ABC and cable net Freeform. At this rate, the two units’ dedicated staff will consist of a single half-time janitor charged with turning out the lights after the final layoffs.
But if the scripts are getting tiresome, it’s not likely this series gets cancelled soon. Hollywood has been building toward this for at least three years, beginning with a string of big consolidations as media companies scaled up to better compete against digital giants Apple, Amazon and, especially, Netflix.
Those deals—Disney/Fox/Hulu, AT&T-Time Warner, Comcast/Sky, Viacom-CBS—generated an initial series of layoffs and departures, as companies tried to realize some smidgen of the “synergies” they typically over-promised to investors.
For instance, Disney’s $71.5 billion acquisition of much of 21st Century Fox, which closed in March 2019, set off a near-Darwinian cull of employees from both companies. Survivors included several of Fox’s star TV executives, including Peter Rice and Dana Walden, who displaced their Disney equivalents.
It’s worth noting that Rice and Walden head the two units that experienced many of this week’s Disney layoffs. But they’re hardly alone in presiding over epic downsizing/restructuring/right-sizing in Hollywood.
WarnerMedia has had its own lengthy string of layoffs and cuts since AT&T bought it, then had pay down $150 billion in debt while building out its 5G mobile network.
The merged company has laid off hundreds, closed some non-core units and sold others. And it’s still cleaning out the cabinet, slashing staffing at branded-content/influencer-management shop Fullscreen, and shopping popular anime service CrunchyRoll.
But the more notable WarnerMedia restructuring started in August, a few months after Jason Kilar took over as CEO. Weeks after his arrival, HBO Max launched in mid-pandemic to desultory subscriber interest and widespread brand confusion. Ever since, Kilar has been sandblasting silos and barriers between the many Warner units, sending out the door hundreds of employees and a phalanx of prominent executives such as WarnerMedia Entertainment Chairman Robert Greenblatt, who had been bumped up to that august position during the previous round of cuts.
Greenblatt’s old stomping grounds, NBCUniversal, has been doing its own streaming-first restructuring, and so too has ViacomCBS as it prepares to launch a rebranded, more mountainous Paramount Plus streaming service.
Disney, of course, is facing even more challenges than any of its Hollywood competitors. The non-entertainment divisions that helped inure it from traditional ups and downs in TV and film were particularly vulnerable to the pandemic. Parks, cruise lines, live events, sports programming, consumer products, all were hammered even as the movie business effectively shut down.
As it is, Disneyland remains closed in Southern California, and Disney executives signaled additional park furloughs are coming on top of the 28,000 laid off in September.
And for those who grew up in the 1990s, or whose children did, the week held one final episode featuring the town’s most common story line: the closure of Radio Disney.
The syndicated radio operation defined the Millennial child’s music universe in the era of Britney Spears, Justin Bieber and Backstreet Boys. Now, like so much else that defined Hollywood the past 30 years, it’s gone.
Amid all this, it’s hard to see what ends The Cut Show. Companies must keep slowly extracting themselves from legacy businesses in film, broadcast and cable as those sectors shrink, while competing for market share in the world of streaming.
Those challenges will only sharpen as a result of the week’s other big news: WarnerMedia’s decision to release all 17 of its 2021 films—including blockbusters such as Dune, The Matrix 4, Suicide Girls 2 and Godzilla vs. Kong—simultaneously to theaters and HBO Max. That likely will force the rest of the town to get even more “Streaming First.”
In fact, there’s only one Hollywood job sector likely to see significant growth in coming months: the HBO Max stunner reportedly was announced without telling WarnerMedia production partners, deal participants or theater operators ahead of time. A lot of people may be calling their lawyers.
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