New Delhi: TV18 Broadcast Ltd, which runs a bouquet of television channels, started handing out letters to employees on Friday, terminating the services of several hundred people, including journalists, camera crew and personnel in the technical, sales and marketing teams, said three persons familiar with the situation.
The retrenchments, the largest in the media industry, are part of a massive restructuring that involves the integration of some of the group’s newsrooms and reducing costs as it seeks to cope with a turbulent economy that has affected the advertising market.
“There is silence, the office is less crowded and it’s been like this for a week now,” said an employee of IBN7 network, which operates CNN-IBN as well as the IBN7 news channel, declining to be identified.
TV18 Broadcast, which runs news channels including CNN-IBN, CNBC-TV18 and IBN7, has reduced its staff by 300-400 people—30% of the group’s total estimated workforce of 1,300 people, said the persons cited above who spoke on condition of anonymity. It is a part of Network18 Media and Investments Ltd, the listed holding firm. Sai Kumar, chief executive, Network18, and Raghav Bahl, managing director at Network18, did not respond to queries sent by email. Bahl did not respond to repeated phone calls.
Production teams, which include cameramen and editors, were the worst-affected across bureaus, followed by teams handling feature programming and entertainment shows.
“It’s a blood bath, the camera section has been massacred, technical and operations teams have been hit,” said the employee quoted above, who’s based in New Delhi.
“A lot of the half-hour feature shows like Living it Up (a popular lifestyle show aired on weekends) have been discontinued, while teams of other shows like Citizen Journalism have been halved,” said another employee of the TV18 group, requesting anonymity.
The layoffs were across departments, from editorial and production to sales and marketing teams. As part of the restructuring, the operations teams of CNN IBN and IBN7 have been merged, and a huge number of employees at the Hindi business news channel CNBC Awaaz’s Delhi operations have been laid off, said the second employee quoted above.
An online ad sales executive at Network18 said all group websites including Firstpost.com, Moneycontrol.com and IBN7.com will or already have separate chief executive officers so the profit-making abilities of the websites can be monitored.
“Some senior level movement is expected in Web18”, the Internet and mobile arm of Network18, the ad sales executive said.
The indirect control that Reliance Industries Ltd has over the media house has triggered talk that the restructuring is being engineered by the conglomerate and its chairman Mukesh Ambani, Mint reported earlier this week. A year-and-a-half ago, Reliance committed around Rs.4,800 crore in cash and assets towards TV18 group. The media group, which has a presence in the television, movies and e-commerce businesses, reported a net profit of Rs.19 crore for the June quarter against a loss of Rs.90 crore a year earlier. Advertising revenue grew 6% to Rs.227.5 crore. According to media analysts, the advertising cap of 12 minutes per broadcast hour as notified by the Telecom Regulatory Authority of India is a big worry for all news broadcasters.
“As a news broadcaster, the 12 minute ad cap can be a big issue and until digital addressable system revenues kick in on the subscription side, it is going to be detrimental in terms of growth, revenue and profit margins,” said Ashish Pherwani, media and entertainment industry expert at consulting firm EY (formerly Ernst and Young). “The margins are under pressure constantly, and this is something the industry is experiencing right now.”