ESPN Laying Off HundredsFirst Major Staff Cuts Since 2009 5/21/2013 9:51 AM Eastern
ESPN is laying off a large portion of its staff, its first major reduction in personnel since 2009.
Deadspin, which first reported the staff cuts Monday morning, said that 400 employees might lose their jobs, although a source indicated that count was high. ESPN, which has some 7,000 employees, would not say how many are being let go.
The layoffs evidently are part of Disney's company-wide review process of staffing levels.
"We are implementing changes across the company to enhance our continued growth while smartly managing costs," said ESPN in a statement. "While difficult, we are confident that it will make us more competitive, innovative and productive."
Deadspin is reporting that most of the layoffs are coming in the technology sector.
The pink slips follow ESPN's recent announcements of a pair of new pacts. Last week, ESPN said that beginning in 2015 it would gain exclusive rights to the U.S. Open tennis championships. Sources indicate that the 11-year pact is valued at some $75 million annually, or $825 million, up from the $20 million ESPN is paying per year for current cable rights to the Grand Slam tournament.
Earlier in May, ESPN and the Southeastern Conference announced the long-anticipated SEC Network. The deal extends and expands their rights agreement another 10 years beyond the extant pact under which the programmer had been scheduled to allocate $150 million annually through 2024. New financial terms were not disclosed.
The worldwide leader also announced at its May 14 upfront presentation to advertisers that it would open a new state of the art studio at its Bristol, Conn. headquarters -- at a reported cost of $125 million -- next year.
During its second quarter ended March 30, The Walt Disney Co. scored a 32% rise in net income to $1.5 billion as its cable networks, including ESPN, turned in a strong performance. The cable networks' operating income rose 15% to $1.7 billion thanks to growth at ESPN, which had increased affiliate revenues and advertising sales that were partially offset by higher programming and production costs.
In April, Disney laid off some 150 people at LucasArts, the video game division of LucasFilm, and about the same number from its movie studio in response to decline in DVD sales.