TORONTO – Saying the global financial situation is “causing sharp decreases in advertising spending and even the potential bankruptcy of some of our single biggest customers,” CTV told employees yesterday that the company is tightening its belt.
A memo from CEO Ivan Fecan announced a country-wide hiring freeze as well as a halt to travel and entertainment spending. “New projects, unspent capital plans will be revised, delayed or halted,” said the memo.
The company hosted a town hall meeting this afternoon to address employee concerns. Layoffs are coming, said Fecan’s memo, but it has yet to be decided where.
This follows last week’s announcement by its chief rival, Canwest Global, that it was letting go 560 people overall, 210 from its TV division alone.
These are scary times for conventional broadcasters in North America and around the globe (NBC Universal this fall announced it was cutting $500 million out of its 2009 expenses, for example) as they face viewers who are turning to a multitude of places for their video entertainment while at the same time, advertisers are pulling back.
And as the big three automakers struggle, too, so will the broadcasters, since they rely so heavily on new car commercials, for example.
“No one knows how long this economic situation will last. Some financial experts suggest it may continue through 2009 and perhaps longer,” wrote Fecan. “This is one of the biggest challenges we’ve ever faced.”
And just like Canwest last week, CTV also place some of the blame for these cutbacks – and impending cutbacks – with the CRTC.
“All of this is in addition to the ongoing structural issues affecting conventional television, which are compounded by the recent CRTC decision,” said Fecan’s memo, referencing the Commission’s October 30th decision not to use its regulatory power to add to the cable and satellite bills of consumers by allowing conventional broadcasters to charge a fee-for-carriage of their signals, which is what they pitched to hard for during the Specialty & Pay and BDU policy hearing back in April.
So while no layoffs have been outlined as yet by CTV management, the company “has asked each department head to identify efficiencies – unfortunately, this will result in some layoffs,” continues the memo.
“Each situation will be judged by its own circumstances. In other words, where there is strong revenue or competitive reasons, we may choose to add, not cut, resources.
“There is never an easy or good time to take these kinds of measures. But we have to keep it real.”
– Greg O’Brien
