The fear gripping so many people — that they might lose their jobs — is paralyzing but not paranoid. Pick your headline, in cable, telecom or anywhere.
Last week alone, MTV Networks parent Viacom said it was making yet another big cutback of 850 jobs, or 7% of its workforce. NBC Universal, again as expected, is looking at about 500 job cuts, or 3% of its employees, and immediate layoffs were reported among ad-sales staff and even at CNBC, which has benefited from higher ratings as business news dominates.
At AT&T, plans are in place for a 4% workforce reduction, or 12,000 jobs cut.
Charter Communications said last week it's consolidating to two from three operating regions and eliminating up to 75 positions. Comcast has been implementing a plan to cut about 300 positions within its Eastern cable operations. Cox Communications said in November it would trim about 460 jobs, or 2% of its workforce.
Time Warner Cable CEO Glenn Britt pointed out in reporting third-quarter earnings that it's “naive” to think cable won't feel a pinch when so many are losing jobs and homes. The fourth quarter has already seen a slowdown in new-service subscriptions, he said. Time Warner Cable says it hasn't made or announced plans for job cuts.
In November alone, the overall economy shed 533,000 jobs — before the many planned cuts announced last week and the worst such monthly loss since December 1974.
Last Tuesday, a day after the official announcement that the economy's been in recession for a year, Merrill Lynch's Jessica Reif Cohen said her firm's top economists don't foresee economic growth in 2009, either.
“The longest and deepest in our lifetimes,” was a term she used to describe the current malaise.
Reif Cohen and Tom Eagan, another Wall Street media maven, said the February transition to digital television could be a boon to cable as non-customers sign up to make their old TV sets continue to function. But that's a short-term lift at best and seems most likely to draw in members of the AARP set. The trends among today's digital youth are about as promising as the economic outlook.
The Consumer Electronics Association takes surveys to find out what gadgets teens have on their holiday wish lists. Last year, a TV set was seventh on the list. This year, TV isn't even in the top 10.
Clearly, cable has to innovate (as well as cost-cut) to keep the needle moving forward. At a conference our magazine and Broadcasting & Cable sponsored last week, David Verklin, head of the six-MSO-backed Canoe Ventures, talked up voting and polling, “t-commerce,” targeted advertising and other enhancements Canoe has in mind to make cable programs (and their ads) more entertaining and engaging.
“Don't count out the television set, don't count out the programming networks, don't count out the cable-TV companies and don't count out the traditional television business,” Verklin said. “Believe me, we get it.”
Let's hope so.