NEW YORK — In another sign of the belt-tightening affecting Network Row, ABC brass is implementing several new companywide cost-saving measures, including a mandatory hiring freeze for all divisions, a 25% reduction in travel and entertainment expenses and the cancellation of all major off-site meetings.
Staffing freeze means that existing openings at the Disney-owned company will not be filled through at least the remainder of ABC’s fiscal year, which ends in September. Some positions currently open may even be eliminated once fiscal planning for 1999-2000 is finished.
No more free lunch
The 25% travel and entertainment cut could prove particularly painful for departments that have already spent more than three-quarters of their annual T&E budgets. It’s expected that those departments will have to operate with essentially no travel or entertainment costs until Oct. 1, though case-by-case exceptions for crucial expenses may be made.
Details of the new measures were outlined in a series of internal memos sent to division heads last month. Cost-saving measures apply to all ABC divisions, including cablers ESPN and the Disney Channel.
Eisner cracks whip
Other divisions within Disney are also expected to feel the budget squeeze. Mouse House topper Michael Eisner ordered a companywide cost savings review two weeks ago following the release of poor first-quarter earnings results.
Declining to confirm any specific budgetary measures, ABC Inc. senior VP of communications Patricia Matson said, “We’ve stepped up our efforts to find ways to save the company money. It’s a challenge because ABC has traditionally been very cost-conscious. But everyone is pitching in and trimming wherever possible.”
The mandate to cancel offsite meetings won’t apply to next month’s affiliate confab in Los Angeles, though ABC had already trimmed back that event to one day, in part to save costs (Daily Variety, May 6).
The Alphabet web will also participate in the July Television Critics Assn. press tour, where all the nets trot out their new fall fare for crix and other TV journos. But the web is reducing its press-tour budget and may also realize coin savings through a tentative cost-sharing arrangement with CBS, Fox and NBC. Webs plan to use a single stage and pool other resources in order to cut costs for the semiannual event.
ABC is hardly the first network to tighten its purse strings. CBS and NBC laid off several hundred employees last year, while Fox parent News Corp. ordered a 3% budget trim across all divisions.
As networks begin making budget plans for their next fiscal year, more budget cuts, and possibly layoffs, are expected.