TORONTO – Saying that the hearings and subsequent licensing of a new pay TV player boosted its expenses, Corus Entertainment eliminated 83 positions on Tuesday as part of an overhaul of its content and television division.
The restructuring will see producer Nelvana folded into the television division and a new lifestyle, drama and movies group created.
Most of the job cuts are in Edmonton, as Move Central’s base is moving to Toronto. Corus’ Calgary offices will remain.
Having come out of a strategic planning session in May with the theme "Core and Explore," the company has decided to focus on two main sectors, kids and lifestyle programming, Corus president and CEO John Cassaday told Cartt.ca in an interview on Tuesday.
This morning’s release sets out the changes as follows
* Nelvana Studios will be folded into the Corus Television division
* Nelvana Enterprises, a separate business unit that will focus on leveraging Corus’ intellectual property internationally, will be created.
* A new lifestyle, drama and movies portfolio for the Television division highlighted by the amalgamation of Movie Central, W Network, CMT and Scream into one integrated portfolio.
* Movie Central’s operations will be moved from Edmonton to Corus’ Toronto broadcast centre.
*Other Corus assets such as its radio group, MaxTrax, Telelatino and the conventional broadcast stations in Kingston and Peterborough, Ont., will remain untouched.
No longer will Nelvana answer to global broadcasters when producing its programming. Shows will be geared specifically for the likes of Treehouse, YTV, Discovery Kids and Teletoon. "We can focus on programming that really meets the needs of YTV, rather than global broadcasters. The start/finish point will be what’s in the best interests of YTV, Teletoon and Treehouse," said Cassaday.
"And as we develop that content, we will be mindful of what form it should take. Will it be two minute vignettes for mobile phones, should there be long-form releases that we’ll put on a downloadable broadband service? These are the kinds of questions that will be most effectively addressed when all of the elements are under the control of one strong individual."
Corus has also met with members of the Canadian production community to convince them partnering with Corus to explore multiplatform opportunities is the way to go. "Our message to the independent production sector is that working through us, you have a better chance at monetizing the value of your investment in programming by taking advantage of our abilities to aggregate content," said Cassaday. "There’s not a lot of money in these areas now but going forward, it will be a fertile area of growth."
Part of the reason for the restructuring was the recent round of pay TV applications at the CRTC, said Cassaday. Having another player come into the market meant that Corus has spent more heavily on longer-than-usual-term programming agreements with its U.S. programming partners. And with such capital costs up, expenses had to be trimmed in order to maintain margins.
"Our costs increased this year as a result of the pay TV applications, so the consolidation in Edmonton was to some degree in response to that. We feel an obligation to maintain our margins, despite the fact that we had a significant increase in program costs," explained Cassaday. "As a public company, no one has any sympathy for me telling them the CRTC increased our spending commitments and we had to pay more to HBO to renew the Sopranos. That’s interesting but irrelevant. They want to know what we’re doing to continue to increase shareholder value."
So, after these cuts – coupled with recent moves to trim costs in its radio division, is Corus finished restructuring? "We never say we’re done because we’re in a business where things change every day. We’re happy with the structure we have for the time being," said Cassaday.
As for who’s in charge of what after Tuesday’s announcement, here goes:
Nelvana Studios will be integrated into the company’s new Kids portfolio. Scott Dyer becomes executive vice president, general manager, kids, reporting to Paul Robertson, president, Corus Television. Dyer had been EVP production and development for Nelvana. He will now be responsible for overseeing YTV, Treehouse, Discovery Kids Canada, and Nelvana Studios.
In his new role, Dyer will also be the Corus conduit to programming executives at Teletoon, and Nelvana Studios will continue to provide content to meet that network’s unique needs, says the press release. Corus (40%) co-owns Teletoon with Astral Media (40%) and other investors.
Nelvana Enterprises will focus on broadcast sales, new platform opportunities and consumer products licensing for all Corus brands internationally. Doug Murphy becomes president, Nelvana Enterprises, reporting to John Cassaday. He had been EVP business development for Nelvana. Murphy’s new division will focus on creating international opportunities for Corus, including new networks, new distribution platforms and new partnerships.
“Recent deals such as our video on demand services with Comcast U.S. and British Telecommunications, and the Corus partnership with NBC, Ion, Scholastic and Classic Media to launch the new U.S. kids network Qubo, are excellent examples of the value of our content in international markets,” said Cassaday. Nelvana Enterprises will operate out of Toronto, Paris and Shannon, closing its offices in the U.K. and Los Angeles.
Susan Ross becomes EVP and GM of the lifestyle, drama and movies portfolio. Reporting to Robertson, Ross, who was EVP of Corus specialty channels, will be responsible for Movie Central, W Network, CMT and Scream. “Creating a new lifestyle, drama and movies portfolio allows Corus to maximize program buying efficiencies across these high-growth assets and focus on integrated strategies for movie acquisitions and investments, as well as website and other new platform plans, including SVOD, VOD and high-definition rollouts,” said Robertson.
Andrew Eddy, currently VP and GM, Movie Central, takes on the role of VP, program strategy and investment. Reporting to Ross on Movie Central programming, Eddy will also report to Robertson and be responsible for equity film investments, programming operations, industry relations and special projects.
All appointments were effective Tuesday. "Corus expects all changes resulting from the new organizational structure to be completed by January 2007," adds the press release.
