ROME — With ad spending and ratings down, the ax is falling on Italian pubcaster RAI, with cutbacks set to shut down its North American outpost, along with several foreign bureaus and other international offshoots.
Austerity measures at the mammoth broadcaster, which has more than 13,000 staffers, this month prompted pink slips at several offices, including New York-based RAI Corp.; and RAI Med, which airs to the Arab world. Several other RAI bureaus, including Nairobi, Beirut, Istanbul, New Delhi, Buenos Aires and Moscow, are next on its cutback list.
Austerity measures are also affecting RAI’s local content. The country’s TV producers’ association, APT, is up in arms over a proposed $40 million cut in RAI’s local fiction investment, down to $185 million in 2012, a 44% drop compared with 2008. This could be good news for Hollywood, since U.S. skeins may be needed to fill those slots.
After years in the red, RAI is striving to break even in fiscal 2011. But ratings are steadily dropping and analysts predict the pubcaster’s ad intake to dip at least 5% in 2012 after a more than 10% plunge in 2010.
A new study by Italo think tank Eurispes shows escalating ratings erosion at all of Italy’s general-interest channels, with RAI and Mediaset having lost more than 15% of their combined market share as the country switched from analogue to digital.
Mediaset, however, has diversified into pay TV and still commands a whopping 60% of the Italian TV advertising market.
Recently installed Italo prime minister Mario Monti, a technocrat, has vowed to tackle RAI’s problems by eliminating the age-old tradition of political interference in the pubcaster’s operations. Monti’s intent is to wrest RAI away from predatory Italian pols who have made it their fiefdom for years.
If anyone can bring about that monumental change, it’s the mild-mannered non-pol. In early February, Monti ruffled feathers, calling RAI “a problem we cannot elude” while announcing plans to establish an as-yet-undefined new governance model, more detached from parliament, after the term of RAI’s current board expires in March. But the question remains: If he succeeds will that cure everything that ails the pubcaster?
“RAI’s crisis is deeper than it looks,” warns Italo media analyst Augusto Preta, topper of Rome-based ITmedia Consulting. “Hiring competent managers with no affiliations to political parties is not enough, if they don’t have vision.”
Preta argues that current cuts of some $330 million are depriving RAI of the quality content crucial to relaunching the pubcaster on new platforms which, he says, is key to the pubcaster’s long-term survival.