Walt Disney Co.’s ESPN sports network, confronting rising programming costs and a loss of viewers, plans to eliminate as many as 350 positions, about 4.3 percent of its workforce, sources told Bloomberg News.
The cuts will be announced to employees as early as Wednesday, said the people, who asked not to be identified discussing the matter because it isn’t public.
The action follows Disney’s announcement in August that earnings at its cable networks won’t meet company forecasts as a result of subscriber losses and currency translation. That triggered a selloff in the shares of many media companies. Disney had the second-largest long-term commitment to sports programming at $44.2 billion behind only 21st Century Fox Inc., according to Bloomberg Intelligence. That was before signing a long-term agreement with the NBA.
An ESPN spokesman declined to comment. The sports broadcaster, based in Bristol, Conn., employs 8,000 people worldwide, according to a company fact sheet.
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“ESPN has historically embraced evolving technology to smartly navigate our business,” the company said in a statement last month when plans for job cuts were reported by thebiglead.com. “Any organizational changes will be announced directly to our employees if and when appropriate.”
ESPN has also made changes in on-air personnel this year, cutting commentators Bill Simmons and Keith Olbermann. In 2013, the sports network eliminated jobs when it closed a Denver office and shut down a 3-D video service.
The network, which commands the highest price per customer among basic cable channels, has lost more than 4 million subscribers in the past four years, according to researcher SNL Kagan.
Disney Chairman and Chief Executive Officer Robert Iger said on an Aug. 4 conference call that ESPN was experiencing “modest” subscriber losses. The company lowered its projected annual growth in operating income at its cable TV business to mid-single digits percentages, from high-digit percentages in the four-year period through fiscal 2016.
In October 2014, Disney and Time Warner Inc. signed nine- year programming accords that will bring the National Basketball Association $24 billion.