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Disney-21st Fox Layoffs: TV Divisions Brace for Deep Cuts

A second day of layoffs has begun on the Fox lot in the wake of Disney completing its acquisition of 21st Century Fox on Wednesday.

Longtime 20th Century Fox Television Distribution president Mark Kaner is among the senior executives who were formally notified with severance details on Friday morning.

21st Century Fox’s international TV sales arm is among the divisions that has direct overlap with existing operations at Disney, so there is little surprise that Kaner’s group would be affected. Nonetheless, the atmosphere on the Fox lot is extremely somber given the longevity that many executives and their teams have enjoyed. Kaner had headed the division since 1994.

Layoff notices came on Thursday to dozens of staffers on the film side of the 20th Century Fox studio, including numerous executives at the president, executive VP and senior VP level. Large-scale layoffs were anticipated as part of the historic consolidation of two of Hollywood’s biggest and oldest studios. But the reality of it sank in hard on Thursday as executives and lower-level staffers watched the notification process unfold.

On Friday morning, there was dread among 20th Century Fox TV and ABC Studios staffers of cuts to their ranks because the TV studio operations are duplicative. But as the day wore on there were no signs of a mass exodus. Dana Walden, chairman of Disney Television Studios and ABC Entertainment, issued a lengthy memo heralding the “palpable” excitement of the companies coming together.

“The combined companies represent a dream team of executives and staff, and we all share the same goal — to be the best by creating the best environment for our people and our extraordinary creative partners,” Walden wrote.

The cuts followed the formal closing of Disney’s $71.3 billion acquisition of 21st Century Fox, which took effect at 9:02 p.m. PT on Tuesday. On Wednesday morning, after the acquisition was finalized, Peter Rice — chairman, Walt Disney Television and co-chair, Disney Media Networks — sent an upbeat note to staff. Rice wrote, “The intensely creative spirit of both these companies positions us well inside Disney at a time of real disruption for our industry.”

Staffers said they were bracing for a ” ‘Lord of the Flies’ situation,” in the words of a Fox TV veteran, as employees raised concern that the cuts may be a rolling process that come over a period of months. That prospect has employees worried about working in a highly agitated atmosphere for the near term. Disney chairman-CEO Bob Iger acknowledged the pain on the horizon for rank-and-file employees in a lengthy memo sent to Disney’s more than 200,000 employees on Tuesday night. In that note, Iger mentioned that the evaluation of the best structure and management hierarchy may take some time to sort through.

“Our integration process will be an evolution, with some businesses impacted more than others,” Iger wrote. “We’ve made many critical decisions already, but some areas still require further evaluation. We may not have answers to all of your questions at this moment but we understand how vital information is, and we’re committed to moving as quickly as possible to provide clarity regarding how your role may be impacted.”

Craig Hunegs, the Warner Bros, veteran who just joined Disney to head television studios under Walden (who reports to Rice) introduced himself to staff Friday with a memo of his own, writing: “As we go forward, each of our studios – ABC Studios led by Patrick Moran, 20th Century Fox Television led by Jonnie Davis and Howard Kurtzman and Fox 21 led by Bert Salke – will continue to carve out unique identities with their own distinctive creative taste. I’m here to help bring it all together, to have us work seamlessly as a group.”

Here is Walden’s full memo:

Day three, and the energy and excitement inside our newly merged organization is palpable! I’m so happy to be starting this journey with all of you. To say I’ve been looking forward to this week would be an enormous understatement, and I want to start by thanking you for the warmth thoughtfulness and goodwill many of you have already extended to your new colleagues.

Over the past few months, I have had the good fortune of getting to know some of you on the Disney side, and throughout my 26 years at Fox I’ve been lucky to work with many of you for decades. The combined companies represent a dream team of executives and staff, and we all share the same goal — to be the best by creating the best environment for our people and our extraordinary creative partners.

When you look across the Disney Television Studios, ABC Entertainment. the ABC Owned TV stations and Freeform, many of us have already worked together in the past. Our companies have a long history of teaming up to do spectacular things together. Look no further than multiple Emmy and Golden Globe winner Modern Family for an example of the extraordinary work that resulted when we joined forces. That happened when we were completely separate companies — just think about how much we can achieve now that we are united. There is no greater bonding experience than shared success, and I know that going forward we will have much to celebrate together.

I am genuinely thrilled to be embarking on this new chapter in my career with a stellar leadership team — Karey, Craig, Tom and Wendy –who understand that a winning business starts with a winning culture. The five of us realize that bringing our businesses together will require strategy and patience. Please know that we are all here for you and that we too are experiencing both the exhilaration and anxiety that accompany change.

Throughout my own transition to becoming a Disney employee, I have been thoroughly impressed with The Walt Disney Company’s Human Resources team. They are compassionate and highly skilled executives who are here to help us all through the integration. Each business unit has a dedicated HR business partner, with home you can be connected through your supervisor. They’ve produced this five-minute video that highlights how you can think about and embrace change. I hope everyone will take the time to watch it.

Finally, I am almost overwhelmed by the excitement I feel for our future. We are now positioned to win, big time, and I am grateful to Bob and Peter for giving me this opportunity. I am especially proud to be working with all of you.

Warmest regards,

Dana

Here is Rice’s memo:

Dear colleagues,

Yesterday, The Walt Disney Company made history, bringing together iconic brands and businesses from Disney and 21st Century Fox. Today begins the hard but incredibly exciting work of mapping out the future for our combined television brands, which together represent the very best in creativity.

I’m thrilled to be embarking on this journey with all of you. I spent every day of the last 30 years driving onto the Fox lot. I managed to make it to Disney today without getting lost, and like everyone coming over from Fox, I’m still learning my way around this lot, memorizing all the new faces, business operations and acronyms, and discovering new short cuts across the lot. I’m happy to report that everyone has been incredibly warm and welcoming. I’ve found that Disney and Fox are at their heart, remarkably similar businesses. They’re two of the world’s great storytelling companies. Both are populated by extremely talented people driven by a deep commitment to the highest quality artistry and a truly innovative approach to the business of entertainment.

The intensely creative spirit of both these companies positions us well inside Disney at a time of real disruption for our industry. As Bob said in his note yesterday, we are reimagining the future of entertainment and will take full advantage of evolving consumer trends and emerging technologies to feed that demand. Our television business plays a critical role here. It’s a massive creative engine providing entertainment, news and information to fuel the company’s networks, streaming platforms and direct-to-consumer service.

The scale of the combined business that make up Walt Disney Television is truly remarkable. It includes 257 ongoing and forthcoming shows, 258 Emmy nominations last year, and a monthly audience reach of 227 million people in the US alone. We are home to some of the most powerful brands in television, and with the full weight of the company behind us, we have the opportunity to target these brands globally at a scale that’s never been possible before.

Whether you’re traveling over from Fox or continuing in your current role at Disney, I urge you to introduce yourselves to your new colleagues and explore new ways that we can collaborate. While we may have different experiences and backgrounds, we have deeply shared values and a single common mission: to be the greatest television company the world has ever known. We will face changes and challenges ahead as we unite our teams toward this mission. But our success as a team will spring from our collegiality, and our commitment to supporting one another across every segment of our business, with the utmost respect and transparency. I highly recommend you take full advantage of the helpful resources and information that are available on the Inside Disney site. We’ve also created an online org chart to familiarize you with the businesses of Walt Disney Television.

I am incredibly proud to be here and could not be more excited to be working with all of you as we write the next spectacular chapter for our company.

Warmly,

Peter

And Hunegs’ memo:

For those of you I haven’t met, I’m Craig Hunegs, President of Disney Television Studios. I feel so fortunate to join Disney, to work for Peter and Dana and to lead our exceptional TV studios.

I’m sure you agree, it’s a truly unique time to create television and we enter it with great strength. Across our studios, we have an unmatched roster of executives and talent, the highest quality programs and an exciting lineup of development projects. Disney has networks and streaming services with an insatiable need for high quality, diverse programs. We have unprecedented opportunities for our creators to tell stories and touch audiences.

As we go forward, each of our studios – ABC Studios led by Patrick Moran, 20th Century Fox Television led by Jonnie Davis and Howard Kurtzman and Fox 21 led by Bert Salke – will continue to carve out unique identities with their own distinctive creative taste. I’m here to help bring it all together, to have us work seamlessly as a group. It’s a time of rapid, fundamental change in television and I’ll work with all of you to make sure we have what we need to grow and succeed. I’ll also focus hard on making DTS the absolute best place to work for talent, for executives and for all our employees.

An important measure for us will be the compelling, breakout series we create for our sister platforms, ABC, Disney+, Freeform, FX, Hulu and NatGeo. Our relationship with them will figure hugely in our success, and across creative and business affairs we will aim for a true, friction-less partnership.

I feel incredibly lucky to do what we do. We touch and entertain audiences all over the world and together we can do it in an even more impactful way.

Over the coming weeks, I look forward to meeting and getting to know each and every one of you.

Best,
Craig

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